Overnight Headlines

• US Dollar Gains vs Euro, Pound on Safety Demand as Stocks Decline
• New Zealand Dollar Outperforms on Rising Payouts for Dairy Farmers
• UK House Prices Surge in February, Overall Trend Still Disappointing

Critical Levels

CCY	SUPPORT	RESISTANCE
EURUSD	1.3574	1.3745
GBPUSD	1.6165	1.6328

The Euro and the British Pound declined, falling as much as 0.3 and 0.2 percent respectively against the US Dollar as stocks sold off in overnight trade, boosting safety-seeking demand for the benchmark currency. We remain short EURUSD.

Asia Session: What Happened

CCY	GMT	EVENT	ACT	EXP	PREV
JPY	15:00	Cabinet Office Monthly Economic Report	-	-	-
NZD	21:30	Performance Services Index (JAN)	50.8	-	52.1 (R-)
GBP	0:01	Rightmove House Prices (MoM) (FEB)	3.1%	-	0.3%
GBP	0:01	Rightmove House Prices (YoY) (FEB)	0.3%	-	0.4%
NZD	2:00	Credit Card Spending (MoM) (JAN)	3.8%	-	-1.7% (R-)
NZD	2:00	Credit Card Spending (YoY) (JAN)	5.6%	-	2.1% (R+)
JPY	4:30	All Industry Activity Index (MoM) (DEC)	-0.2%	-	-0.2% (R-)

The New Zealand Dollar outperformed in overnight trade, overlooking mixed economic data and a selloff across Asian stock exchanges, amid speculation that Fonterra Cooperative Group Ltd – the world’s largest dairy exporter – may raise its payout to farmers after milk powder prices hit a 31-month high. Higher payouts promise to boost hiring and spending in New Zealand’s top export industry, adding fuel to the sluggish economic recovery. The currency rose 0.5 percent on average against its major counterparts.

The New ZealandPerformance of Services Index slid to 50.8 in January, showing the non-manufacturing sector expanded at the slowest pace in 15 months. Meanwhile, Credit Card Spending soared 5.6 percent from the preceding year, showing the fastest annual growth rate since May 2008. The MSCI Asia Pacific regional benchmark index fell as downward pressure from last week’s Chinese RRR increase was compounded by spreading tensions in the Middle East, with uprisings spreading to Libya, Bahrain and Iran.

UK House Prices surged in February, rising 3.1 percent from the previous month according to report from Righmove Plc, an online listing of for-sale properties. The increase is the largest in four months. Looking past month-to-month volatility however, the trend in house prices remains troubling. Indeed, the same report showed prices added just 0.3 percent from a year before, putting the annualized growth rate at the slowest in 16 months.

Euro Session: What to Expect

CCY	GMT	EVENT	EXP	PREV	IMPACT
CHF	8:00	Money Supply M3 (YoY) (JAN)	-	6.6%	Low
EUR	8:00	French PMI Manufacturing (FEB P)	55.3	54.9	Low
EUR	8:00	French PMI Services (FEB P)	58.0	57.8	Low
EUR	8:30	German PMI Manufacturing (FEB A)	60.3	60.5	Medium
EUR	8:30	German PMI Services (FEB A)	60.2	60.3	Medium
EUR	9:00	German IFO - Business Climate (FEB)	110.3	110.3	Medium
EUR	9:00	German IFO - Current Assessment (FEB)	113	112.8	Medium
EUR	9:00	German IFO – Expectations (FEB)	107.5	107.8	Medium
EUR	9:00	Euro-Zone PMI Composite (FEB A)	56.9	57.0	Medium
EUR	9:00	Euro-Zone PMI Manufacturing (FEB A)	57.2	57.3	Medium
EUR	9:00	Euro-Zone PMI Services (FEB A)	55.9	55.9	Medium

Risk sentiment is likely to remain a key catalyst for currency markets in European hours as investors continue to fret about mounting tensions sweeping the Middle East and North Africa. Stock index futures ticked lower and stocks sold off in Asia after Saif al-Islam Qaddafi, the son of Libyan leader Muammar Qaddafi, spoke out on state-run television warning of an impending civil war as Tunisian- and Egyptian-style protests were met with a harsh response from security forces. Libya is the world’s 12th-largest oil exporter.

On the data front, Germany’s IFO Survey of business confidence is expected to show sentiment soured a bit, with the closely-watched “Expectations” index down to 107.5 in February having hit a record-high 107.8 in the previous month. Meanwhile, February’s preliminary Euro Zone Purchasing Manager Index figures are set to reveal region-wide economic activity decelerated for the first time since October, driven by a slowdown in manufacturing-sector growth.

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Retail sales rose 352 percent in the ten years since 1997, while gross domestic product (GDP) increased by only 264.77 percent, according to the General Statistics Office.

The difference in the growth rates shows that the domestic market significantly contributed to the economic growth. Even during the Southeast Asian financial crisis of 1997, retail sales remained on an upward trend. It rose 5.7 percent in 1998 and 4.1 percent in 1999 against a GDP rise of 5.8 percent and 4.8 percent. Retail sales between 2001 and 2005 rose by an average of 10.3 percent a year, far in excess of GDP growth which averaged a mere 7.5 percent in the period. In 2006 and 2007, retail sales surged by an average of 14.5 percent annually, double the GDP growth of 8.4 percent in the period. In money terms, it rose from US$10.8 billion in 1997 to $45.7 billion in 2007. Sales of consumer products increased from 81.4 percent of total retail sales in 1997 to 83.4 percent in 2000. But by 2007 they had slumped to 77 percent, but remained at a hefty $35.2 billion as the size of the overall retail market had skyrocketed. The Red River Delta, Mekong Delta and southeastern region accounted for 75.9 percent of the retail market. By Nguyen Van Son* *Nguyen Van Son is an economist Source: SGTT

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A sculpture depicting the Maitreya Buddha to be displayed at an exhibition in Ho Chi Minh City for the Buddha’s birthday Buddhist and other art works will be on show in Ho Chi Minh City from Sunday until next Friday for the 2553rd anniversary of the Buddha’s birth.

The profits from the exhibition of paintings, calligraphy, sculptures and decorated stones by local artists and monks will be given to 80 city workers with fatal diseases. As well as art to examine and buy, there will be poetry chanting, martial art demonstrations, and performances of cai luong (southern folk opera) and other music. La Pagoda in Go Vap District is the main organizer of the event at the HCMC Labor and Culture Palace, 55B Nguyen Thi Minh Khai Street, District 1. Reported by Ha Dinh Nguyen

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The go-getter spirit and “people skills,” such as networking and the ability to cooperate, are the keys to business success, said participants at an international conference in Ho Chi Minh City Friday.

Addressing the 19th Asian Corporate Conference, Henry B. Nguyen, managing general partner of IDG Ventures Vietnam, said a solid definition of the “entrepreneurial spirit” was not prevalent in Vietnam. He said it was this lack of clarity that led many small- and medium-sized enterprises to collapse in their early years. He said Vietnamese were not as good at networking and cooperating as their overseas counterparts. “This must change as cooperation and networking help us create synergy, especially in the economic crisis,” he said. “In the end, people drive business.” Government support is also essential, he added. Just do it Ly Qui Trung, founder and CEO of Pho 24 Corporation said, “I had the idea for Pho 24 on a flight from Vietnam to Australia several years ago. I was sitting next to an Australian man who said Vietnam always reminded him of the pho and vice versa. “My wife asked if I have a mental problem when I first mentioned pho business to her,” he said. But now Pho 24 now has an extensive network of about 70 outlets across Vietnam, Southeast Asia with future plans for the European and US markets. “If you really want to start a business, write out and outline your idea on paper and ask for advice from experts,” he said. Cutting red tape Hoang Van Dung, standing vice chairman of the Vietnam Chamber of Commerce and Industry (VCCI), said his organization had been working hard to remove all obstacles to entrepreneurship in Vietnam. Dung said, “About 96 percent of Vietnamese firms are small- and medium enterprises and they typically face capital shortages and problems with red-tape.” At last month’s meeting held in Ho Chi Minh City to review Vietnam’s two-year WTO membership, former Minister of Trade Truong Dinh Tuyen said the country had reformed bureaucracy but that slow administrative procedures still added extra costs to the opening of any business here. The legal system is also inefficient, he said, and a confusing legal framework creates liabilities for people and business. Dung said VCCI had worked with the US government to launch the Vietnamese provincial competitive index program to rank local authorities’ support for business communities. “The program aims to bring about better business legislation,” he said. Reported by Vinh Bao

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A broker (2nd, L) at real estate company Dat Xanh points out locations to potential buyers Interest rate cuts and cheaper construction material costs have pushed down housing prices in Ho Chi Minh City, said a senior executive at a property company.

Some developers have reduced apartment prices by 40-50 percent from last year as construction material prices have fallen to a three-year low, said Luong Tri Thin, general director of property firm Dat Xanh. He also said builders could now borrow easier from banks, enabling them to complete projects at lower initial costs. Efforts to stimulate the economy have seen the central bank slash the key rate from 8.5 percent to 7 percent, allowing commercial banks to charge interest on dong loans up to 50 percent above the benchmark rate, which is now only 10.5 percent a year. Dat Xanh plans to offer 224 apartments in the SunView Apartment building in HCMC’s Thu Duc District at the price of US$764 per square meter, a drop of more than $500 a square meter from last year. According to the HCMC-based firm, 60 percent of its customers wanted to pay no more than VND1 billion ($57,200) for a full apartment while only 10 percent were in the market for apartments at $1,500 per square meter or more. Property firm Vinh Tuong has begun selling apartments in Block 3 of the Tan Tao Building in Binh Tan District at some VND9 million ($515) per square meter. Each 70-120 square meter apartment has two bedrooms. Apartments in Nam Long Company’s Ehome Building in District 9, which is under construction and scheduled to open by September, are on sale for VND11.5-14.5 million ($671-847) per square meter. Apartments larger than 50 square meters at the 17-storey Sunshine Building under construction in Thu Duc District are expected to be sold for only VND500-VND600 million ($29,197-35,036). HAGL Land cut prices for its new Hoang Anh River View apartments in District 2 by 40 percent to US$1,350 per square meter last week. It has also lowered prices at another project in Nha Be District to $1,250 from $1,800 per square meter. Le Hung, director of HAGL Land, said the price cuts would “revolutionize” the HCMC property market in line with government efforts to stimulate the economy. In Hanoi, medium and low-income apartments are selling for a whopping VND25 million per square meter, said Le Xuan Truong at property firm B.D.S Co. Thin told Thanh Nien that property firms didn’t expect profits this year to look anything like they did in 2007, when prices and sales went through the roof. But 2009 is set to beat dreary 2008. “Their earning growth target is 20- 30 percent this year,” said Thin. In another boon to the local property market, several banks have recently begun offering loans for house and apartment purchases. Western Bank is lending a maximum of VND1 billion to potential homebuyers at interest rates of between 10.5-13.2 percent a year for the first three months. Tien Phong Bank is offering 15-year mortgages worth 70 percent of the house value at 10 percent interest. Vietnam Export-Import Commercial Joint Stock Bank, or Eximbank, Asia Commercial Bank and Sacombank are also offering housing loans. Reported by Thanh Nien staff

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The Ministry of Construction has issued policies on the use of public and private space in apartment buildings as well as on fees charged to condominium owners.

The ministry circular requires the apartment sales contract to distinguish between the buyer’s private space and the building’s public space, such as the hallways, stairs, lifts and parking lots. Both the Housing Law and ministry regulations state that apartment building residents do not have to pay to use public spaces. Condominium contracts must designate what facilities might be owned by the buildings’ developers such as swimming pools, tennis courts or supermarkets. Deputy Minister Nguyen Tran Nam said the instructions should have come sooner to prevent the many conflicts that have flared up between apartment occupants and investors. Some apartment building developers in Ho Chi Minh City asked residents to pay enormous fees of up to US$25,000 for a car parking space or to use meeting areas, child care facilities and even libraries. Also in line with the new circular, all contracts must specify the apartment’s exact measurements in detail. Two percent of each apartment price will be used for maintenance fees. If the amount is not enough, the developers can ask residents to contribute extra fees based on the size of their apartments, according to the ministry. The sale contract must mention these fees and estimate the amount each household must pay to cover the other costs of operating the buildings, Nam said. City and provincial People’s Committees will decide the maximum operation fee for apartment buildings in their jurisdiction, according to the ministry. The developers and buyers will rely on those ceiling fees to work out specific payments in their sales contracts. Nam said committees are allowed to change the ceiling fees every year depending on market prices.

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Oil tanks at the Dung Quat Oil Refinery, Vietnam’s first such facility, in the central province of Quang Ngai. The country imported 26.2 percent fewer oil products by volume but the value fell 60 percent to $753 million during the first two months. Vietnam has reported its first year-to-date trade surplus since 2006, as companies slash overseas purchases of equipment and raw materials amid tumbling demand.

The surplus for the first two months of the year totaled US$290 million, compared with a deficit of $5.13 billion in the same period a year earlier, the General Statistics Office (GSO) said Wednesday in Hanoi. Exports fell 5.1 percent to $8.02 billion, while imports plunged 43.1 percent to $7.73 billion, according to the preliminary figures. The GSO also revised the trade surplus for January to $390 million, up from an initial estimate of $300 million. “Due to the impact of the world economic turmoil on the Vietnamese economy, the country was forced to strongly reduce its imports. It is the first [monthly] trade surplus we’ve had since 2006,” AFP quoted a GSO official as saying. Vietnam has not posted a full-year trade surplus since 1992. The economy last year suffered from a widening trade deficit and double-digit inflation but both have been brought back under control. Now, however, the government faces the challenge of protecting the economy from the worst of the global recession, and the authorities have taken aggressive monetary easing steps while drawing up a modest fiscal stimulus package. Still, the trade data suggested the economy was feeling the effects of the downturn. This year’s reversal may indicate a sharp slowdown in Vietnamese economic activity. “A positive trade balance in Vietnam would worry me a bit, because it would suggest that economic growth isn’t there,” said Alain Cany, chairman of the European Chamber of Commerce in Vietnam. “Vietnam needs to import in order to grow. It is not self-sufficient.” Economic growth slowed to 6.2 percent last year from 8.5 percent in 2007. The government hopes to keep it at 6-6.5 percent this year, though the International Monetary Fund and others forecast growth to be closer to 5 percent. Prime Minister Nguyen Tan Dung earlier this month said he expected the slowdown to end by May. The improvement in Vietnam’s trade balance “is largely a reflection of weaker domestic demand, which is cutting into imports,” said James McCormack, head of Asia sovereign ratings at Fitch Ratings in Hong Kong. “It’s been surprising to see just how weak the import numbers have been in Asia.” In the first two months of 2009, Vietnam spent $412 million on steel, down by 74.2 percent and $169 million on fertilizers, down 33.7 percent. Machinery and equipment imports fell 24 percent to $1.77 billion, while petroleum-product imports fell 26.2 percent by volume and 60 percent by value to $753 million. The country on Sunday opened its first crude oil refinery in the central province of Quang Ngai, which operator Vietnam Oil & Gas Group, known as PetroVietnam, says may meet about one-third of the country’s fuel demand next year. Imports of inputs used in garment production slumped, with purchases of cloth slipping 4 percent to $494 million. “Orders are down for light export industries,” said Cany of the European Business Chamber in Vietnam. “Probably some companies were surprised by the extent orders fell and they were overstocked, which significantly reduced their import demand.” Mixed export results Exports were buoyed by an estimated rise of more than 3,000 percent in sales of precious metals and gemstones to $939 million. Garment and textile exports were up by 0.7 percent to $1.27 billion. Rice exports were estimated to have more than doubled at $399 million. The US Foreign Agricultural Service this month cut its forecast for rice exports this year by Thailand, the world’s biggest shipper of the grain, citing “increased competition” from Vietnam. Rubber exports, however, slipped 50 percent to $101 million in the first two months of the year. Coffee exports slipped 10 percent by value to $440 million. Vietnamese coffee farmers have been withholding sales to the market since the end of the country’s Tet (Lunar New Year) holiday in late January, according to a February 23 note from Hong Kong-based SW Commodities. “Exports from Vietnam depend largely on the prices of key commodities,” said Adam McCarty, chief economist at Mekong Economics Ltd. in Hanoi. Crude oil shipments fell 42 percent by value to $958 million, as global prices of the commodity have been an average of 57 percent lower so far this year than during the same period a year earlier. By volume, crude oil shipments rose 27 percent. Crude oil is Vietnam’s biggest foreign exchange earner. “Vietnam’s oil output should increase to about 16 million tons this year,” said PetroVietnam Chairman Dinh La Thang, in a February 21 interview in the town of Quang Ngai. The state-owned company said at the end of December that it produced about 15 million tons of crude oil and condensate in 2008. Vietnamese crude oil production may reach 20 million tons annually by 2012 and the country hopes to be able to sustain that level of output for as many as seven years, Thang said. Although crude oil output is expected to rise, the government said December 31 that crude exports may decline 13.7 percent this year because of the operation of Dung Quat oil refinery. FDI down Vietnam drew more than $5.3 billion from foreign investors in the first two months of the year, or 70 percent of the same period last year, the Ministry of Planning and Investment’s Foreign Investment Agency said in a report Wednesday. The country granted licenses for 67 new projects with total registered capital of more than $1.5 billion in January and February. Investors of 10 existing projects were allowed to increase their capital by a total of more than $3.8 billion, according to the statement. Vietnam expects to receive $12 billion of pledged foreign investment in 2009, Phan Huu Thang, director of the ministry’s foreign investment department, said on Vietnam Television’s InfoTV early this month. The country last November said the overseas disbursement level, which represents actual cash received from promised foreign investment, may drop to as low as $10 billion in 2009 amid the global financial crisis. Source: TN, Agencies (With additional reporting by Ngan Anh)

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Customers at the HAGL Land office on Monday. The company has cut the prices for its new Hoang Anh River View apartments in Ho Chi Minh City’s District 2 by 40 percent to US$1,350 per square meter. The Ho Chi Minh City property market has started edging up again after many developers decided to reduce prices to make them more realistic, a top industry executive said.

Le Hoang Chau, chairman of the HCMC Real Estate Association, told Thanh Nien: “I notice there are signs of a recovery. “I expect the market to rise this year, especially after June.” “The good thing is many developers now know they need to balance their profits with buyers’ interest by lowering prices.” HAGL Land on Monday cut the prices for its new Hoang Anh River View apartments in District 2 by 40 percent to US$1,350 per square meter. It also lowered prices at another project in Nha Be District to $1,250 from $1,800 per square meter. Le Hung, director of HAGL Land, said the price cuts are “revolutionary” in the HCMC property market and are in line with government efforts to stimulate the economy. “The large number of customers coming to register for purchases shows there are positive signs for the luxury apartment market,” Hung said. “If prices are reasonable and close to the real value of the property, investors will be attracted again.” Hung said the price cuts were possible because his company had purchased land for the projects at low prices a long time ago and construction material prices have also dropped recently. Though apartment prices have been lowered, the quality would remain the same, he assured. Dang Hong Anh, chairman of Saigon Thuong Tin Real Estate Joint Stock Company, or Sacomreal, an affiliate of the listed Sacombank, said the price cuts at the two HAGL apartment projects, accompanied by the easy credit flows from four banks – BIDV, Vietcombank, Sacombank and Military Bank – have helped lure customers back to the market. The banks lend up to 70 percent of the value of an apartment at an interest rate of 10.5 percent for up to 15 years. HAGL Land and Sacomreal reported more than 300 inquiries for the two projects on Monday with 100 people making deposits. According to Sacomreal, apartment sales at the Orient Apartment project in District 4 have also increased sharply in recent days. Duong Dinh Tuan, a resident of Thu Duc District, said he has booked an apartment in Hoang Anh River View after withdrawing all his savings. He said he thought it is better to invest in real estate since bank interest rates are rather low. Many home buyers said it has become easier to buy apartments because many banks are trying to get credit flowing, offering loans at lower rates. Sacombank General Director Tran Xuan Huy said his bank has earmarked VND3-5 trillion ($172-287 million) for loans for buying and repairing property at flexible interest rates. The State Bank of Vietnam, the central bank, on January 23 cut its benchmark interest rate for a sixth time since October, to 7 percent from 8.5 percent, to head off an economic slowdown. The central bank said in a statement earlier this month that borrowing costs have dropped by 0.5-1.2 percent since December to 10.82-11.52 percent. Lam Van Chuc, chairman of Phuc Duc Real Estate Company, said he thought the property market would not recover until the end of 2010. “But with trading increasing recently, it is likely that the real estate market will recover by mid-year,” he said. “As deposit interest rates are currently at low levels, many people will choose to invest in real estate, including apartments. Even if they cannot earn high profits like before, they can rent out their apartments.” The prices of not only apartments but also land have been cut to their actual value to attract buyers, Chuc added. A director of a real estate company, who wished to remain unnamed, said after Phu My Hung Corporation sold out all 133 units in a new apartment block earlier this year, many developers regained belief in the market and prepared to launch new products. Sacomreal’s Anh said his company would soon begin to sell more than 1,500 luxury apartments in District 7 and begin planning some other new projects, Lao Dong (Labor) newspaper reported. Thu Duc House announced it would unveil a residential project with 260 apartments today. The company said it would give priority to home buyers who have a real need – rather than speculators – and would try to keep prices reasonable. Source: TN, TT

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Government defers income tax collection to spur spending

Vietnam would lose around VND1 trillion (US$57.3 million) every month if it waives income tax for five months, Deputy Minister of Finance Do Hoang Anh Tuan said The government will delay the collection of personal income tax until the end of May to help stimulate spending amid the global economic crisis.

Personal income including salaries, profit from real estate and stock transactions and other investment returns would not be taxed until May, the government said in a statement posted on its website Monday. The National Assembly will decide then if the payments will be waived completely or just delayed. The economy expanded 6.2 percent in 2008, the slowest pace in nine years, as the global recession cut demand for Vietnamese exports in the US and Japan. The government is targeting 6.5 percent growth for this year. The government said last month it would provide a 30 percent rebate on tax bills from the fourth quarter of last year onwards for small- and medium-sized firms, defined as those having less than VND10 billion (US$572,000) in capital or employing fewer than 300 workers. It will also cut value-added tax by half in February for products like coal, construction materials, engineering equipment used to make other products and automobile parts. The country would lose around VND1 trillion ($57.3 million) every month if it waives income tax for five months, Tuoi Tre newspaper reported on January 13, citing Deputy Minister of Finance Do Hoang Anh Tuan. Non-resident individuals would not have to pay tax on income from financial investments, transactions, copyright and franchising until May, Monday’s statement said. Source: Bloomberg

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Feb. 5 (Bloomberg) -- Shares of the following are having unusual fluctuations in U.S. trading. Stock symbols are in parentheses and share prices are as of 9:45 a.m. in New York.

Akamai Technologies Inc. (AKAM:US) gained 11 percent to $15.70 for the biggest advance in the Standard & Poor’s 500 Index. The largest supplier of software and services that speed up the delivery of Web sites reported fourth-quarter profit of 44 cents a share, or 9.5 percent more than the average analyst estimate.

Assurant Inc. (AIZ:US) fell 4.8 percent to $24.90. The home insurer said operating profit, which excludes some investment results, was $1.31 a share. That missed the $1.44 average estimate of analysts surveyed by Bloomberg.

BMC Software Inc. (BMC:US) climbed 4.6 percent to $27.07. The maker of programs that manage databases and computer networks said profit for the year ending in March will be as much as $2.30 a share, or 7 percent more than the average analyst estimate.

Cisco Systems Inc. (CSCO:US) lost 1.8 percent to $15.56. The largest maker of networking equipment projected sales that missed analysts’ estimates. Third-quarter revenue will drop between 15 percent and 20 percent, Cisco said. That indicates a range of $7.8 billion to $8.3 billion. Analysts in a Bloomberg survey had estimated $8.76 billion for the period, which ends in April.

CommVault Systems Inc. (CVLT:US) fell 10 percent to $11.74. The supplier of data-management software to Las Vegas forecast annual sales and profit that trailed its previous projection.

Concur Technologies Inc. (CNQR:US) fell 15 percent to $21.45. The maker of software for managing travel expenses forecast second-quarter revenue growth of 6 percent from the previous three months, missing analysts’ estimates.

Dell Inc. (DELL:US) dropped 4.4 percent to $9.36. The world’s second-biggest maker of personal computers was cut to “underweight” from “neutral” by analysts at JPMorgan Chase & Co. who said costs and competition “could derail a return to margin stability or result in cash burn.”

Dolby Laboratories Inc. (DLB:US) jumped 13 percent to $29.25. The maker of sound systems for film and music reported fiscal first-quarter profit of 58 cents a share, or 37 percent more than the average analyst estimate.

Equity Residential (EQR:US) fell 8.2 percent to $21.50. The largest U.S. real estate investment trust that owns apartments said fourth-quarter earnings excluding items fell because of the cost of canceling new developments.

Harman International Industries Inc. (HAR:US) dropped 13 percent to $13.06. The audio-equipment maker reported an unexpected fiscal second-quarter loss of 18 cents a share. Analysts forecast profit of 17 cents, the average estimate in a Bloomberg survey.

Visa Inc. (V:US) rose 8.1 percent to $53.12. The largest electronic payments network reported earnings that topped analysts’ estimates on gains outside the U.S. and said it would meet previous profit targets. Adjusted net income was 78 cents a share, beating the 66-cent average estimate of 22 analysts surveyed by Bloomberg.

Wal-Mart Stores Inc. (WMT:US) rose the most in the Dow Jones Industrial Average, adding 2.5 percent to $47.57. The world’s largest retailer reported January sales that exceeded its projection as discounted groceries and $4 medicines brought in more customers.

Western Union Co. (WU:US) lost 10 percent to $12.39. The world’s biggest money-transfer business forecast 2009 earnings in the range of $1.26 a share at most. That missed the $1.38 average estimate in a Bloomberg survey of analysts.

To contact the reporter on this story: Lu Wang in New York at lwang8@bloomberg.net
Last Updated: February 5, 2009 10:04 EST

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The procedures to get the subsidized loans would be very quick and simple to ensure loan applicants do not miss the chance to recover from the economic downturn, said Cao Sy Kiem, a member of the National Advisory Council for Monetary Policy. The central bank Wednesday announced guidelines for the 4 percent loan subsidies the government announced for companies, with most commercial banks saying they are clear and adequate.

The subsidy, part of a US$1 billion economic stimulus package, will be provided for loans taken by both state-owned and private businesses, except those operating in 13 specified industries like entertainment, real estate and securities. According to a circular posted on the State Bank of Vietnam (SBV) website, commercial banks have to register for the subsidies no later than the 10th day of every quarter. For loan support in February and March this year, the deadline is February 10. Banks have also been told to report monthly subsidies no later than the 10th day of the following month. Based on these reports, the central bank will transfer 80 percent of the subsidies every month. The rest will be transferred after the banks submit the whole year’s report. Eligible firms will get the subsidies for up to eight months on short-term loans taken between February and December this year. Chairman of the state-owned Vietinbank, Pham Huy Hung, said since the central bank’s guidelines are clear, his bank would immediately inform customers of the subsidy program. Hung said 60 percent of his clients are small and medium-sized enterprises and the subsidy would help them remain in business. Vietinbank is Vietnam’s fourth-largest lender by assets. Vietcombank CEO Nguyen Phuoc Thanh said his bank would start implementing the subsidy scheme. One fourth of the customers at his bank are small or medium companies. Dau Tu Chung Khoan (Securities investment) magazine Wednesday quoted him as saying the government’s decision would get credit flowing and, more importantly, lower prices. He also noted that local banks are flush with liquidity. The SBV is aiming to keep credit growth in the banking system at around 20 percent in 2009 after a rise of 21-22 percent last year. A senior official at HSBC Vietnam Wednesday told Thanh Nien Daily the bank is waiting for more detailed instructions from the central bank concerning eligibility criteria. The central bank held a meeting with commercial banks in Ho Chi Minh City Wednesday to discuss implementation of the scheme. Cao Sy Kiem, a member of the National Advisory Council for Monetary Policy, told Thanh Nien Daily the procedures to get the subsidized loans would be very quick and simple to ensure loan applicants do not miss the chance to recover from the economic downturn. Kiem, a former central bank governor, said, however, SBV needs to keep the procedures uniform at all banks so that none of them cause difficulties to borrowers. Last month the benchmark rate was lowered to 7 percent from 8.5 percent, the sixth rate cut since October. Commercial banks use it to calculate their lending rates, which should not exceed 150 percent of this rate. Some businesses said, however, they would not benefit from lower interest rates since orders have declined sharply, they have cut back on production, and do not need new loans. Reported by Thanh Nien staff

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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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At least 350 households at the 727 Tran Hung Dao apartment block in District 5 have refused to relocate, citing unsatisfactory compensation. The block is in imminent danger of collapsing. Unsatisfactory compensation and relocation plans are blamed as residents stay on.

Its foundation has sunk and cracks run up and down the walls as though they are ropes used to tie the building to the ground. Residents of the apartment block in Ho Chi Minh City’s District 5 know that their building is crumbling and on the brink of collapse, but they are staying put. The deadline for relocating the residents, so that the 727 Tran Hung Dao apartment block in District 5 could be demolished for a skyscraper to take its place, was April 30 this year. As with other similar projects, inadequate compensation and relocation plans have left residents angry and uncertain about their future. On December 10, the municipal administration issued another dispatch saying the eviction and site clearance of the apartment block, home to 535 households, must be completed by next March at the latest. But so far at least 350 households have declined to move, despite the fact that the block could collapse at any time. Under the relocation plan, each evicted resident would receive compensation of between VND7-8 million (US$412-471) per square meter depending on the floor they live. “The compensation fees for my apartment, covering an area of 25 square meters, would be just around VND200 million ($11,772). How can I buy a new house with that money?” asked a resident on the third floor. Nguyen Van Nha, the block’s deputy manager, pointed out another shortcoming hindering the relocation. As part of the plan, the block residents are set to be moved to the Nguyen Bieu apartment block in the same district. Since each apartment there is nearly double the size of their current residences, evicted residents are being asked to pay for the surplus area which costs between VND23-29 million ($1,350-1,700) per square meter. That means each evicted resident would have to pay an additional VND600 million (about $33,400) each for their new apartment, Nha said, saying this was another reason discouraging hundreds of households in the block from moving. Compensation disputes have also bogged down two other dilapidated apartment blocks in the city. In its December 10 dispatch, the city government mentioned that the buildings on 192 Nam Ky Khoi Nghia Street in District 3 and 289 Tran Hung Dao Street in District 1 will also have to be demolished by March 2009. But 15 households sharing the same walls with the 289 Tran Hung Dao apartment block in an adjacent alley have insisted on staying though the investor has offered to increase their compensation fees to VND90 million ($5,300) from VND69 million ($4,061) per square meter. The investor also promised to provide them with financial assistance of between VND350-450 million ($20,600-26,500) each. Recently, the District 1 government warned it would carry out compulsory eviction of those 15 households if they continued to defy the relocation directive. At the apartment on Nam Ky Khoi Nghia Street in District 3, two evicted households have lodged complaints about unsatisfactory compensation. THE MASS RELOCATION PLAN In a dispatch issued on December 10, the HCMC government said it would spend around VND1.78 trillion (US$104.4 million) for revamping dilapidated apartment buildings with around 2,000 households set for eviction. The Department of Construction is tasked with overseeing the demolition of 20 ramshackle apartment buildings between now and 2010 and ensuring evicted residents are properly housed in new homes. The apartment buildings at 289 Tran Hung Dao Street in District 1, 192 Nam Ky Khoi Nghia Street in District 3 and 727 Tran Hung Dao Street in District 5 will be the first to be demolished. After 2010, another 156 apartment buildings are set to be demolished and some 14,300 households resettled, the dispatch said. Reported by Tran Thanh Binh

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