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The general hospital in Ninh Thuan Province on Tuesday cut a doctor’s salary, reprimanded another doctor and two nurses who last month falsely informed that a baby was born dead.

Doctor Tran Thi Hong Hoa, head of the night shift on Nov.11 at the hospital’s Obstetrics Department, had her payment cut while doctor Nguyen Thi Thanh Xuan and nurses Le Thi Hong Van, Nguyen Thi Tuyet received warning notes. The hospital didn’t specify how much will be cut from Hoa’s salary. Tran Phuc, director of the hospital in the south central province, said a baby was born prematurely on that night with low weight and slow heart beat. Phuc blamed the team on duty for being “ignorant and irresponsible” as they “hastily” concluded that the baby was dead. The family had brought the baby home to hold its funeral, but found that it was still alive. The baby was taken to Ho Chi Minh City’s Pediatric Hospital No.1 for treatment and is reportedly getting better. Reported by Thien Nhan

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Banks in Vietnam cut their dollar lending rates on the interbank market in the past week due to a growing surplus after firms switched to borrowing in Vietnamese dong under a government stimulus package, bankers said.

The State Bank of Vietnam said on Monday banks cut their dollar lending rates for nearly all terms in the week ending August 27. Rates on 12-month loans dropped to 1.7 percent from 2.8 percent the previous week. Many companies that needed dollars earlier this year have switched to borrowing in dong because of a government rate subsidy package, leaving banks with a surplus of the foreign currency, the official Securities Investment newspaper said. It said central bank measures to limit the use of the dollar in domestic markets had also helped reduce demand. On August 20 the central bank and the Industry and Trade Ministry agreed to tighten control over foreign exchange as dollar rates rose on the unofficial market and the country's exports were forecast to fall 6.4 percent this year to US$58.6 billion. On the unofficial market, the dollar rose to 18,390/18,430 dong on Monday from 18,370/18,390 last Friday. Commercial banks lent businesses about VND398 trillion ($22.3 billion), equivalent to 81 percent of the government’s loan-subsidy program, as of August 27, according to a statement on the government’s website. Last week the value of subsidized loans rose 0.43 percent from a week before, accelerating from 0.25 percent the previous week, central bank data shows. Governor Giau told a seminar last week the central bank would maintain its looser monetary stance, with the annual credit growth target lifted to 30 percent from the 25-27 percent set earlier by the government. Money supply would be targeted to expand 30 percent in 2009, accelerating from 20 percent growth last year, Giau said in a statement seen on Monday. “Inflation is on a rising trend in the last months of the year due to the impact of the easier fiscal and monetary policy,” he said, forecasting inflation this year at 6 percent to 8 percent. Consumer prices surged 22.9 percent in 2008. The central bank said state-run banks raised their dong deposit rates slightly, offering to pay 8.2-8.4 percent on six-month deposits against 8.0-8.4 percent a week ago, but that was below the 8.5-8.9 percent offered by partly private banks. Last week bankers said commercial banks extended their campaign to raise dong funds by increasing interest rates and in one case offering gold prizes. Source: Thanh Nien, Reuters

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A worker packages cooking oil bottles at a factory in Ho Chi Minh City Further fiscal stimulus is needed as the US$8 billion package this year has worked its way through the economy, showing good results, experts say.

If the economy is not completely out of the woods by the end of the current stimulus package, its continuation should be considered though the amount can be smaller, economist Vu Dinh Anh said Friday in a report on Vietnam Television’s website Cao Sy Kiem, a member of the National Advisory Council for Monetary Policy, said more stimulus measures would be necessary even after the economy has recovered. “Local businesses need to descend the ladder step by step and there should not be any abrupt end in stimulus spending,” Kiem said in an interview with Tien Phong newspaper Wednesday. Although the government’s program to subsidize 4 percent of the interest rate on loans taken by local businesses has shown real effects, it can only meet about one third of the credit demand, he said, noting the program is also set to close in the next four months. Vietnam’s economy accelerated in the second quarter as the stimulus helped drive credit growth and buoyed construction activity. The nation’s commercial banks have lent more than VND397.7 trillion ($22.3 billion) to businesses as part of the government’s loan-subsidy program as of August 27, a 0.43 percent increase from a week earlier, according to a central bank report Friday. “The government’s interest-rate subsidy program has helped the banking system and companies avoid bad debt and bankruptcies,” Tran Du Lich, a member of Vietnam’s National Assembly Committee for Economic Affairs, said at a conference in Ho Chi Minh City on August 19. Lich said the National Assembly will early next year discuss the size of another lending program for medium and long-term loans to help companies restructure businesses through the end of next year. The International Monetary Fund has said the global economy is recovering from a severe downturn, but it is too soon for governments to begin winding down stimulus efforts, according to AFP. “The outlook is improving but we do feel that it is very important to stress that it is no time for complacency,” AFP quoted IMF spokeswoman Caroline Atkinson as saying at a news conference Thursday. Kiem said interest rates on loans subsidized by the government are around 6 percent now but they would return to around 10 percent without the subsidies, which would cause many difficulties for local businesses. “What the government should do is to provide more credit,” he said, noting a credit growth target of around 30 percent is viable. The central bank plans to ease limits on credit growth this year as it aims to help the nation reach its economic expansion target of about 5 percent. The State Bank of Vietnam aims to cap expansion in lending at 30 percent, and will try to slow loan growth in the coming years, Governor Nguyen Van Giau said in a statement on the central bank’s website Friday. Credit from banks has grown 25 percent in the eight months through August from the end of last year, Giau said at a meeting in Da Lat on Friday. Vietnam’s economy may grow 5.2 percent this year, he said. Source: Thanh Nien, Bloomberg

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Workers at Saigon 2 Garment Company. Apparel makers anticipate a tough year ahead and want the government to give them a helping hand. The textile and garment industry is demanding government assistance to overcome the export hurdles posed by the recession.

At a meeting organized by the Vietnam National Textile and Garment Group (Vinatex) with Deputy Minister of Industry and Trade Bui Xuan Khu in Ho Chi Minh City Wednesday, apparel exporters suggested that the government should consider introducing a package of three measures. The first is for assisting workers in businesses facing export difficulties or considering layoffs, Le Quoc An, chairman of the group and of the Vietnam Textile and Apparel Association, said. He suggested spending 1 percent of the total garment export earnings. The second, worth VND5 trillion (US$294 million), is for subsidizing exporters’ bank credit. An said the rate offered by banks may have fallen to 12 percent recently but it is still too high at a time of recession. The third measure is for promoting the industry in the international market at a cost of VND50 billion ($2.94 million). Vietnam’s main apparel markets are the US, Japan and the EU. Khu assured them that the government would support the industry since it is a major foreign currency earner. Textiles, in fact, replaced crude oil as the top earner last year at $9.1 billion after the plunge in oil prices. The industry also created more jobs than the others, he said, adding his ministry would submit the package to the government for approval. Shrinking orders An said Vietnam’s apparel producers had less export orders than last year. Foreign businesses were affected the most though they have more orders than local producers, he said. Many of them cut jobs and closed factories because of the economic slump in key markets like the US, Japan, and the EU, he said. He forecast exports to fall 15 percent year-on-year in the first quarter. But he said it is difficult to set a target for the whole year since no one knows when the recession would end. Bui Van Tien, general director of Viet Tien Garment Corporation, said recessions occurred in every decade, adding firms should not worry too much about them. But they should restructure their business and train human resources, he said. The industry would recover soon if apparel producers focused on the home market in addition to their traditional export markets, he assured. Reported by Minh Quang

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The Ho Chi Minh Stock Exchange moved lower Tuesday over growing concern about negative corporate earnings this year.

VN-Index lost 5.05 points, or 1.62 percent, to close at a 10-day low of 307.13. Of its 175 members, 26 gained and 113 declined. Trading remained quiet, with only 7.7 million shares being traded. “The outlook on corporate earnings is very gloomy, given the current economic situation,” Huynh Anh Tuan, chief executive officer of the Ho Chi Minh City-based SJC Securities, said. “Companies have started to release 2008 earnings and many of them have made losses or missed their profit targets. For those who managed to make some profit, it was because of the gains they made in the first half of 2008. “In addition, people also lost a lot of their confidence in the market after HSBC said the Vietnamese market is no longer investable for overseas investors. “Besides, almost half of January has passed but we are still not yet clear how and when the government is going to implement its US$6 billion stimulus package to boost the economy. So, the market has no momentum.” Dau Tu Chung Khoan (Securities investment) newspaper quoted Kim Long Securities Company Deputy General Director Pham Vinh Thanh as saying, “Companies with a strong cash flow and those not involved in finance are a good choice this year.” He added that petroleum, transport, technology and financial stocks would be his top picks when the market shows signs of recovery, without explaining his choices. How they fared Vinpearl (VPL) lost VND2,500, or 4.17 percent, to close at VND57,500. VFG Investment Joint Stock Company became a major shareholder in the resort operator after buying 5,045,000 shares, or a 5.05 percent stake last month, according to a report on the exchange’s website. Saigon Securities Inc. (SSI), the country’s leading brokerage, slipped VND1,100, or 3.63 percent, to VND29,200. ANZ Bank failed to buy around 1.4 million shares amid a “gloomy market and its low liquidity,” the exchange said on its website. ANZ now holds 18.35 percent in the Hanoi- based brokerage. Thu Duc Trading and Import Export Joint Stock Company (TMC) remained unchanged at VND21,500. The firm said on the exchange’s website that retail investor La Tang Duc bought 242,060 shares, or 6.05 percent, to become a major shareholder. Saigon Fishing Net Joint-Stock Company (SFN), a silk thread and fishing net producer, gained VND400, or 4.2 percent, its most in two weeks, to finish at VND9,900. The HCMC-based company will start buying back 100,000 shares from January 20, according to a stock exchange announcement. “The buyback volume is not huge, but given the daily trading volume of the shares, which is about several thousand a day, this buyback plan could move the stock,” Hoang Thach Lan, chief analyst at HCMC-based SME Securities Company, said. Reported by Hoang Uy

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Swiss and German institutes will help Vietnam train international marketing and export management experts in an attempt to improve the image of local businesses in the global market.

Switzerland-based European Institute of Foreign Trade and German Reutlingen University’s Export Academy will collaborate with TFF (Training For the Future), a Vietnamese business training school, to offer courses from April. A TFF official told Thanh Nien Daily Tuesday the 18-month courses, partly funded by the Swiss government, would offer essential knowledge about marketing and export skills in an international setting. Those who complete the courses will obtain masters degrees in international marketing and export management. Reported by Minh Quang

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Foreign ministry spokesperson Bui Le Dung on his way to a press briefing. Dung says the job is about the art of balancing both calmness and frankness. Foreign ministry spokesperson shares his thoughts on a job where every word has to be weighed carefully before it is uttered.

Twenty years ago, a 28-year-old graduate of the then Institute of International Relations was excited about heading to New York City as part of the country’s entourage to the United Nations. At the time, Bui Le Dung was the youngest member of the delegation. “That was a very difficult period for us,” Dung recalled in a recent conversation with Thanh Nien. “We were still under the embargo of the United States, and at that time, the American public and its media weren’t leaning towards us.” Now, as the spokesperson of the Ministry of Foreign Affairs, the 48- year-old is virtually the spokesperson for the country, a very familiar face for both international and domestic reporters, doing a job where, he joked, he “would get fired if one word went wrong.” Dung says his official brief is to explain and clarify issues relating to Vietnam that the public and other countries are interested in. In a country where there is no tradition of having spokespersons at every government office at all levels, the job is even tougher and doesn’t begin or end with appearing twice every month in front of the media. “For that five to ten minutes, we have to prepare for weeks and must be able to update information until the last minute,” Dung says. “And by the last minute, I mean from the moment I leave the office to the moment I enter the briefing room.” Dung says he never stops learning something new, and sticks to a longstanding habit of noting down everything he feels necessary. When the former Foreign Affairs Minister Nguyen Co Thach once requested the staff to find a sentence in a speech by the Cambodian King Sihanouk, no one was able to find it except Dung, who happened to have written the sentence down in one of his notebooks. “For me, this job isn’t much different from a soldier entering a battle,” he says. “There have been many times when I’ve had to face provoking questions and the only way you can do it is by staying calm.” And that holds true even when he is frustrated that the facts have been twisted. Speaking for the nation, according to Dung, is really the art of balancing both calmness and frankness, meaning one has to phrase things in a way that addresses the reporters’ questions but also “directs” the news issues. “You have to be flexible in all situations. That’s the trick. Your gestures must reflect what you want to say and that takes a lot of practice.” Dung says he tries to pack his answers with diverse information, though for some issues considered “sensitive,” he must stay very focused and accurate with every single word. Sometimes, this is criticized by reporters as providing “same-same” answers. “I know the White House spokesperson often make jokes during briefings to make things less stressful. I do it as well, but not often. Our culture is different and that doesn’t allow me to go beyond the limit.” Dung says he tries his best not to avoid a single question. “The worst thing you can do in a press briefing is not answer questions.” At home? “The spokesperson is my wife. “She understands my job. Sometimes, I have to wake up at midnight to answer phone calls from reporters but I don’t mind. For reporters, information is like their food. I want to help them provide accurate and fair stories.” Reported by Xuan Danh

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Police examinine the wastewater dumping system of Vedan Vietnam in Dong Nai Province. Vedan Vietnam, the Taiwanese company caught polluting a Dong Nai Province river, has not stopped discharging wastewater into the river, local inspectors said.

The monosodium glutamate (MSG)-maker’s illegal drainage system had not yet been removed despite being threatened with the loss of its wastewater discharge license, according to inspectors from the southern province. In mid-September, the company was found using the illegal drainage system to discharge large amounts of untreated wastewater into the Thi Vai River. Vedan Vietnam had paid VND265 million (US$15,993) in fines as dictated by a Ministry of Natural Resources and Environment (MNRE) decision, Dong Nai Department of Natural Resources and Environment Director Le Viet Hung said Wednesday. The company had closed two plants that produced lysine and starch and cut the volume of water used in production to 15,000 cubic meters from 28,000 cubic meters a day, Hung said. Hung said inspections of Vedan Vietnam’s facilities had confirmed the company was still pumping wastewater into the river. MNRE has issued a decision to revoke the firm’s wastewater discharge license for six months. However, it is not clear who has the authority to order a complete suspension of the firm’s operations. Provincial inspection agencies have submitted their reports on Vedan Vietnam to local police. The reports said that after Vedan Vietnam’s illegal drainage system was discovered, the company signed contracts to export around 130,000 tons of wastewater to Taiwan by sea. This year, the firm planned to use 638,180 tons of cassava from more than 20,000 Vietnamese farmers, the inspectors said. The inspectors recommended the provincial government and MNRE find a way to ensure the incomes of cassava farmers and Vedan Vietnam’s 2,000 workers are not harmed. Investigations will continue investigating into the Taiwanese company’s failure to pay wastewater discharge fees of VND127 billion ($7.7 million) over the 14 years it was dumping untreated waste into the river. The provincial environmental police department has received around 2,600 petitions from farmers from the nearby districts of Long Thanh and Nhon Trach demanding compensation from Vedan Vietnam for the pollution that affected their production. Reported by Hoang Tuan

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As the seafood export target for the year is pushed further uphill by falling demand from major markets hit by the global financial crisis, some companies are looking for succor in the domestic market.

They are targeting domestic customers by processing more catfish products to supply restaurants and supermarkets. An executive from the Vinh Hoan Seafood Company said the domestic trend to use processed seafood products was increasing thanks to reasonable prices and increased convenience. Seafood exporters could find stability amid the global turmoil if they know how to exploit the domestic market potential, he said. This year’s export target of US$4.2 billion has become steeper for Vietnam’s seafood industry as the volumes shipped to major markets like the US and EU decline with the fall out of the global financial crisis. The Vietnam Association of Seafood Exporters and Processors (VASEP) says more than 930,000 tons of seafood were shipped in the first nine months of this year, generating $3.35 billion, for a 23 percent year-on-year increase. However, said VASEP Chairman Tran Thien Hai, seafood, one of the country’s main exports by value, was seeing a downward trend in export volume in the fourth quarter. Le Van Quang, chairman of Minh Phu Seafood Joint-Stock Company, said though his company did not have supply problems, it had refused some orders from US importers. “Before [the US recession], they paid for goods immediately after receiving them. But now, they always ask to delay payment as their customers buy goods on one-month credit. How can we dare to sell?” Quang said his company was negotiating better payment terms with importers facing capital shortages as a result of US banks tightening their policies. Ho Quoc Luc, chairman of Sao Ta Foods Joint-Stock Company, said his firm’s South Korean partners had just suspended plans to import goods as the won continued to decline. South Korea’s currency extended its loss this year to 35 percent to become Asia’s worst performer, according to Bloomberg. VASEP official Tran Thien Hai said some foreign customers just ignored contracts signed with Vietnamese exporters though they had earlier given detailed orders. Nguyen Dinh Huan, deputy general director of the An Giang Fisheries Import and Export Joint-Stock Company (Agifish), said though the company was yet to face difficulties in export, he was pessimistic about the near future. “It is certain that purchase orders will be reduced,” said Huan. Vo Thanh Khon, a manager of the Binh An Seafood Company, predicted that some countries would, in response to the economic crunch, re-establish protectionist measures, while consumers would cut their spending. As a result, the Vietnamese fisheries sector would face stiff challenges next year, he said. Minh Phu’s Quang said while input material costs had now increased by 40 percent compared to the beginning of the year, output prices saw no rise, and had actually fallen, in some instances. Hai noted that a kilogram of black tiger shrimp currently sold at only $9.70 against $11 earlier. Enlarging export markets Ho Quoc Luc of Sao Ta said local fisheries should not just focus on big markets like the US and EU, but look for new markets like Islamic nations. He pointed out that Malaysia was a potential market as this country’s annual per capita seafood consumption was expected to reach 61 kilograms by 2010 from the 45 kilograms at present. Nguyen Van Ben, general director of the Vietnam Food Industry Company (Vifon), said the company’s US and EU partners wanted to adjust purchase volumes monthly, and not sign year-long contracts as earlier. The importers also required Vifon to give notice of price increases, if any, two or three months before the effective day with clear reasons. Ben said as demand in traditional markets of Western Europe and North America tumbled, Vifon was trying to penetrate deep into other markets like Japan, South Korea, Singapore, Malaysia, the Philippines, and Eastern Europe. Meanwhile, Vu Thanh Phat, director of Mekong Lotus Company, said increased thrift among US and EU citizens can bring more opportunities for medium-priced Vietnamese seafood products to enter the market. The company has seen that while premium seafood such as tuna and shrimp saw a drop in export volumes, there was greater demand for cheaper seafood like basa catfish and cuttlefish. Source: TBKTSG

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Employees of a leather factory in the northern province of Hung Yen hope that the factory’s wheels will keep spinning once the global downturn hits home Vietnam has handled its domestic economic woes well but must now brace for the “tsunami” of financial turmoil that originated in the US, the International Finance Corporation (IFC) country chief told AFP Friday.

Turbulence on global markets could impact Vietnam’s exports and its inflows of foreign direct investment, Sin Foong Wong, the country manager of the IFC, an arm of the World Bank, said. Wong said Vietnam has done much to stabilize its economy, which after more than a decade of rapid growth has been hit this year with double-digit inflation, a widening trade gap and fears about its currency. The inflation rate reached 27.9 percent in September, and the trade deficit has widened to US$16.2 billion in the first 10 months, but the rates of increase for both have started to level off, according to official data. “Vietnam went through a tough time a few months ago and obviously they have taken a whole series of monetary and fiscal measures, and I think most observers would say things have stabilized,” Wong told AFP. “Inflation increased at its slowest pace in September, growth in the (trade) deficit has also come down. In terms of the currency, there was quite a bit of speculation on the dong six months ago about potential devaluation. “Those things have calmed down and I think the dong is now trading fairly comfortably within the band, and there’s no situation where there is a parallel grey market with a different rate to the official rate.” However, he warned that “now of course you have a different sort of tsunami coming along that originates not within Vietnam but in the US. “And I think everybody in all corners of the world will be affected. It’s a matter of to what degree and with what impact.” Vietnam’s banking sector remains fairly isolated and not exposed to US toxic assets and bad debts, but Vietnam would still be exposed to the wider economic downturn triggered by the financial crisis, he said. “There are these ripple effects that are flowing through the global economy,” Wong said. “One is the impact on the exports. There is a slowdown in the US and Europe, which are key markets. “The other uncertainty is FDI flow. With the global turmoil and the credit crunch, how will it impact investors, whether they are portfolio investors or people coming in to build factories?” Vietnam attracted $56.3 in foreign direct investment (FDI) commitments and $8.1 billion in disbursed FDI between January and September. “So far Vietnam has done tremendously well in attracting FDI, the numbers are terrific,” said Wong. “But in this global situation, I guess they have to be vigilant.” Corporate governance project IFC Friday launched a $2-million program to improve corporate governance, transparency and investor protection in Vietnam. The three-year project aims to help more Vietnamese companies adopt modern business practices as the country integrates further into the global economy after joining the World Trade Organization last year. An IFC statement said “corporate governance standards in Vietnam are poor” and pointed out that Vietnam ranked 170th out of 181 countries for investor protection in the World Bank’s latest annual “Doing Business” survey. “This reflects the very real concerns that investors typically have about the way most companies in Vietnam are managed and the corresponding lack of transparency,” the IFC said in a background paper. The project aims to teach international-standard business rules, including internal control and audit mechanisms, financial reporting and the rights and responsibilities of company boards, managers and shareholders. It would review laws and policies on corporate governance, work on education programs with universities, business leaders and the general public, and help pilot companies reform their operations, the IFC said. “Good corporate governance builds strong companies, and in these times you need strong companies,” Wong said. Source: AFP

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Some Asian power plant projects will be scrapped and many delayed due to tighter financing in response to the global financial crisis, industry officials and bankers said on Tuesday.

But Asia’s growing demand for power will still attract equity financing and the region may even woo European investors, as economic growth and projects slow to a trickle in the West, they told a conference on financing energy projects. “Financing costs will increase. A smaller number of projects will be developed in Asia and lenders will be selective in supporting projects with a strong developer track record,” said Tom Mackay, head of business development Asia for International Power, a power generation company. Mackay declined to name any specific projects that could be cancelled but he and other panelists said renewables might have a tougher time than other power projects. “The bigger the project, the more difficult it will be,” Mackay added on the sidelines of the conference. Coal-fired plants may be more vulnerable than gas-fired ones, as they are more expensive and take longer to build. Project financing began to recover earlier this decade from the slump in the wake of the 1997-1998 Asian financial crisis. Standard Chartered Bank projected in April that project finance was growing strongly in Asia – led by Singapore and Philippine power projects – hitting a record of US$44.8 billion last year and in first-quarter 2008 grew six-fold over a year earlier, despite the global credit crisis. However the crisis has since widened, stoking fears of a global economic recession, leaving banks struggling to fund expansion of infrastructure and energy projects, forcing them to scrutinize deals more closely. “We are still open for business. Good projects with good sponsors can still get done at the right price. But we’ll probably see fewer closings of deals in the next year,” said Nicolas Vix, head of natural resources, infrastructure and power, structured finance Asia for French bank Calyon, investment banking arm of Credit Agricole. Club-style deals Debt financing is already more difficult to obtain and banks may prefer club-style deals, which combine several partners to share the risk from the outset of the project, officials said. This means that small firms will struggle to get debt financing and may require equity financing, or seek developers as partners. “We attend these conferences to find co-investors as there is no way we’ll get money from the bank,” said a senior official with a small Indonesian energy firm, who declined to be named. While developments may slow down, most will still come true. “Asia needs the power so we need to get these deals done,” said Jackie Surtani, head of project finance for Belgian financial services group KBC’s global structured finance team in Asia. Indonesia aims to boost power capacity by 10,000 megawatts of coal-fired plants by 2010 to help ease an electricity crisis that exposes it to blackouts, but the plan is behind schedule. Vietnam Vietnam’s power demand is forecast to rise 14 percent next year, top utility group Electricity of Vietnam (EVN) said, after 2008 consumption jumped 15.16 percent from 2007. The higher lending costs could force governments to raise power tariffs, which have been kept artificially low in most of Asia. While this in turn could make the projects more profitable for investors, a looming recession could deter most governments from raising rates, the officials said. “Does the government have the courage to go ahead? Is this the right time to accept the reality and power prices increases?” said Flora Zhao, director of business development for AES Asia and Middle East, a unit of AES Corp. State-owned monopoly power supplier EVN is seeking government approval to increase power prices by an average of about 16 percent next year. INVESTORS WARY OF VIETNAMESE POWER PROJECTS Tran Viet Ngai, chairman of the Vietnam Energy Association, said only 17 independent power producer projects and two power projects under the Build-Operate-Transfer model have been started, out of the total 47 projects registered earlier. All power projects must undergo bid procedures and then the investors need to fill “countless” documents before they can start construction, he said. After the power plants are built, the investors will have to depend completely on the purchasing of Electricity of Vietnam (EVN), the only buyer, he said, noting that was a factor that had discouraged many private investors and thus restricted investment into the domestic power sector. EVN is a state-owned monopoly that controls all of Vietnam’s transmission grids and network of retailers, including Hanoi Electricity Company and Ho Chi Minh City Electricity Company. Dang Thi Hoang Yen, chairwoman of the board of management of ITA Group, said the group had to deal with many procedural issues when investing in a power project. As well as many kinds of documents required for site clearance, private investors often have difficulties with regulations concerning EVN, she said. Dinh La Thang, chairman of Vietnam National Oil and Gas Group (PetroVietnam), said it took the group’s power arm almost two years to negotiate prices with EVN. But PetroVietnam was still lucky because some foreign investors spent up to six years on price negotiations. In August, PetroVietnam complained that it could only sell limited electricity to EVN, mainly during peak hours, because the monopoly power company wanted to make full use its own generation capacity. The United Nations Conference on Trade and Development (UNCTAD) said in a recent report that Vietnam had attracted many foreign investment projects but very few of them were committed to the power sector. Foreign investors only participate in the production of electricity if they know that what they can earn is worth the risks they face, UNCTAD said. To restructure the power market in Vietnam, production, transmission and retailing must be separated from one another, UNCTAD suggested. Moreover, the Institute of Energy, which plays the role of a consultant in formulation of national strategies and policies on energy and electric power development, should not be managed by EVN anymore. The Electricity Regulatory Authority of Vietnam, currently under the Ministry of Industry and Trade, should also become an independent organization, UNCTAD said. Source: Tuoi Tre Source: Reuters

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