(03-04-2008)
A couple of investors have the board to themselves at the offices of ACB Securities office in Ha Noi. — VNS Photo Viet Thanh
HA NOI — The VN-Index continued inching up yesterday within the confines of the narrower daily trading band instituted a week ago, gaining 0.79 per cent in yesterday’s session to close at 525.11.
Trading, meanwhile, seemed to be slowing to a trickle under the new market restriction, with turnover in yesterday’s session reaching only VND72 billion (US$4.5 million) on a very meagre volume of only 1.1 million shares.
"Buy orders are outnumbering sell orders, but the sellers just are there," said Hoang Quoc Dung, an investor with Viet Nam International Securities.
According to Bui Van Quang, deputy director of SME Securities, investors were holding onto shares because they didn’t see much profit in trading within the narrow band.
"Accordingly, boredom with trading could become a habit if authorities still continue with the tighter band," Quang said.
Despite fears of the stock market becoming frozen, Ta Thanh Binh, deputy head of market development under State Securities Commission, said, "We will continue the narrow band as we see investors are not yet calm. Once the stock market signals some strength, we will loosen the band."
Foreigners were net sellers yesterday, with 308,790 shares bought and 342,450 shares sold.
"Due to the panic of local investors and the gloomy state of the stock market, these minor shifts in buying and selling by foreign traders creates rumours that foreigners are withdrawing from the stock exchange," said Binh.
"That’s not going to happen."
Rang Dong Light and Vacuum Tube (RAL) was the only decliner in yesterday’s session due to passage of the exdate for its dividend payment. RAL closed down 1.22 per cent to VND40,400.
Viet Nam - Italy Steel (VIS) led the market in trading volume, on only 107,400 shares.
In Ha Noi yesterday, the HASTC-Index closed up 1.78 per cent to 187.69. Trading revenue reached only VND23.45 billion ($1.4 million) on a tiny volume of 433,500 shares. — VNS
Friday, 4 April 2008
Tight band slows trades to a trickle
Regulators loosen stock market trade band
(04-04-2008)
Securities officials expect investors to return to the stock exchanges following the State Securities Commission’s decision to loosen the daily trading band, effective next Monday. — VNA/VNS Photo Hoang Hai
HA NOI — Facing the prospect of a stock market nearly grinding to a halt over the past week, the State Securities Commission yesterday decided to loosen the daily trading band in effect on the nation’s stock exchanges by one percentage point, only one week after tightening the band.
Effective on Monday, the trading band on the HCM City Stock Exchange will be 2 per cent, while that at the Ha Noi Securities Trading Centre will be 3 per cent.
The trading band refers to the amount listed shares are allowed to gain or decline in value within a single trading day.
Last week, faced with a plummeting stock market, the State Securities Commission severely tightened the band to stave off a rapid decline in share values. The move had a dramatic chilling effect on trading over the past week, as traders simply stayed away from the market and daily volumes slowed to a trickle.
Volume on the HCM City exchange yesterday was only 1.9 million shares, only a quarter of the daily volume on March 25.
Nguyen Son, head of the commission’s market development department, said, "We decided it today as we have seen an improvement in the market in the past several days, and there are many supporting factors in favour of loosening the band, including agreement by commercial banks to delay selling shares they hold as collateral."
While volumes have shrunk, the VN-Index has increased daily within the maximum of the trading band, resulting in a cumulative 6.5 per cent increase in the seven sessions since March 25. The Index yesterday closed at 529.23, up 0.78 per cent.
Meanwhile, Son noted, the narrow band was allowing investors only a tiny profit in day trading, and had had a negative impact on market liquidity.
The market threatened to become frozen if the tight trading band was retained, he said.
A number of market analysts were urging a further loosening to restart sluggish trading.
"How much profit investors can earn with a two- or three-per-cent band? It is so little," said John Nolan, an analyst from a HCM City-based fund management company. "Given that buys are outweighing sells at the moment, investors now are thirsty for stocks."
In other stock markets worldwide, Son noted, there were circuit-breaking systems in place when the market plunges too deeply within the course of single trading session. The domestic market has no similar system, so tightening the trading band was a stop-gap measure.
"In the position of a market regulator, our commission has a detailed plan for better development of the stock market. We will do our utmost to work with other related offices as well as banks and securities firms to find the best way to achieve the best possible result," Son said. — VNS
Market activity dries up
(04-04-2008)
HA NOI — The HCM City stock market yesterday repeated the same story of the past week or so, with trading once again slowing to a trickle in the wake of the move by the State Securities Commission last month to restrict the rise or fall of shares in a single trading session to plus-or-minus 1 per cent.
The VN-Index once again posted nearly the maximum allowable gains on the day, rising 0.78 per cent to close at 529.23.
But trading volume continued anaemic, with only 1.9 million shares traded. Value of the day’s trades totalled only VND95.19 billion (US$5.9 million), of buy orders continuing to match sell orders by a two-to-one margin, a pattern that has been repeated daily for the past week.
Thuan An Wood Processing (GTA) was the only declining share, as the exdate for its dividend payment passed.
In recent days’ trading, major shares like Saigon Securities Inc (SSI) and Sacombank (STB) largely disappeared from top list of most active shares, with the spots now taken by some seasonal penny stocks.
"This proves the exchange has not yet been stabilised," said Bui Duc Thinh, head of analysis for Royal International Securities. "I think the authorities should keep the recent band for a certain period until investors truly recover from a panic mindset."
Foreign investors yesterday continued to be net sellers of 425,900 shares, but Thinh rejected that this was any basis for worrying over a withdrawal of foreign investors from stock market. Overseas funds, he noticed, continue to maintain a positive view of the Vietnamese market.
"Many overseas financial organisations and banks are waiting for permission to establish offices in our countries," he noted. "That alone suggests the attractiveness of our local market."
Nguyen Dinh Phong, an analyst from VNDirect Securities, said, "Long-term traders have not been impacted much by the tighter trading band. They have been staying home from these sessions."
Day traders, meanwhile, were thirsty to buy shares but have unable to find sellers, with the market falling into a nearly frozen state.
"I think that it’s time to loosen the band as trading is weakening and the stock exchange has lost liquidity," Phong said, adding that the loosening should be implemented gradually in order to avoid unexpected behaviour from investors.
Loosening the band
The State Securities Commision seemed to hear the suggestion, deciding yesterday afternoon, following the close of trading, to raise the daily trading band on both the HCM City and Ha Noi bourses by 1 per cent.
Accordingly, the trading band on the HCM City Stock Exchange will become 2 per cent effective on Monday, and that at the Ha Noi Securities Trading Centre will become 3 per cent.
Phong said the news would warm up the next few trading sessions and help level out the market before the band is returned to its prior levels of 5 per cent in HCM City and 10 per cent in Ha Noi.
The Ha Noi market yesterday continued its seventh gaining session with the HASTC-Index closing up 1.40 per cent to 190.32. Trading turnover ended higher than Wednesday’s session, at VND24.79 billion ($1.5 million), on a volume of 489,800 shares, although several codes saw no trading activity in the session. — VNS
Thursday, 3 April 2008
REE readies construction of new e-towns
(02-04-2008)
HCM CITY — The Refrigeration Electrical Engineering Corporation (REE), which is listed with the HCM City Stock Exchange, will put an additional two e-town projects into use later this year, according to Chairwoman Nguyen Thi Mai Thanh.
The office building E-town 3, which has a total area of more than 16,000sq.m, will receive tenants in May. E-town 4, which is almost 19,000sq.m, will offer space for a shopping mall and offices, and become operational in September. Contracts for the two locations in Tan Binh District have already been signed.
A smaller high-rise of more than 4,000sq.m in District 6 will be finished by year’s end.
Thanh expects to receive a construction license this month for another office building in District 4. This 30,000sq.m building will be completed in two years, she said.
REE and its real estate affiliate REE Land will join in the development of several other projects. They include the 500ha Nam Dinh Vu Industrial Park and a 25,000sq.m office building.
REE is implementing procedures for developing another 500ha IP project in Hai Phong.
The corporation has plans for two additional apartment-commercial-office buildings, one in District 9 and one in Binh Thanh District, said Thanh at the company’s shareholder meeting last week.
REE plans to issue 10 million new shares next year to raise money for its business development. — VNS
Tight band slows trades to a trickle
(03-04-2008)
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| A couple of investors have the board to themselves at the offices of ACB Securities office in Ha Noi. — VNS Photo Viet Thanh |
HA NOI — The VN-Index continued inching up yesterday within the confines of the narrower daily trading band instituted a week ago, gaining 0.79 per cent in yesterday’s session to close at 525.11.
Trading, meanwhile, seemed to be slowing to a trickle under the new market restriction, with turnover in yesterday’s session reaching only VND72 billion (US$4.5 million) on a very meagre volume of only 1.1 million shares.
"Buy orders are outnumbering sell orders, but the sellers just are there," said Hoang Quoc Dung, an investor with Viet Nam International Securities.
According to Bui Van Quang, deputy director of SME Securities, investors were holding onto shares because they didn’t see much profit in trading within the narrow band.
"Accordingly, boredom with trading could become a habit if authorities still continue with the tighter band," Quang said.
Despite fears of the stock market becoming frozen, Ta Thanh Binh, deputy head of market development under State Securities Commission, said, "We will continue the narrow band as we see investors are not yet calm. Once the stock market signals some strength, we will loosen the band."
Foreigners were net sellers yesterday, with 308,790 shares bought and 342,450 shares sold.
"Due to the panic of local investors and the gloomy state of the stock market, these minor shifts in buying and selling by foreign traders creates rumours that foreigners are withdrawing from the stock exchange," said Binh.
"That’s not going to happen."
Rang Dong Light and Vacuum Tube (RAL) was the only decliner in yesterday’s session due to passage of the exdate for its dividend payment. RAL closed down 1.22 per cent to VND40,400.
Viet Nam - Italy Steel (VIS) led the market in trading volume, on only 107,400 shares.
In Ha Noi yesterday, the HASTC-Index closed up 1.78 per cent to 187.69. Trading revenue reached only VND23.45 billion ($1.4 million) on a tiny volume of 433,500 shares. — VNS
Business Beat
(10-03-2008)
VN-Index buoys after State damage control
by Pham Hoang Nam
The Finance Ministry’s decision last week to let the State Capital Investment Corporation (SCIC) invest in the Vietnamese stock market was significant. For one thing, it immediately brought a halt to the relentless decline in the VN-Index, and new hope to investors.
Some experts have said that the decline was necessary to bring market valuations down to realistic levels. It is the price to be paid for the market’s incredible growth in the early part of 2007.
However, it might be hard to convince people who saw the money drain out of their bank accounts day after day about this theory.
The market tanked, according to analysts, because of a series of measures announced by the Government to put a brake on its rapid growth – like the introduction of capital gains tax and tightening margin loans by banks on stocks.
Once investors reacted to this by voting with their feet, the Finance Ministry asked the sovereign fund to invest at home. Will the recovery be sustained? No one knows but experienced investors think after running up for seven or eight sessions, the market will drop again.
Fickle financial policy
The National Finance Super-vision Committee has recently been set up to advise the Prime Minister on the financial market. It has become necessary, at least to avoid the dizzying changes in financial policy after Tet that have left local residents and investors scratching their heads.
Everyone understood that rapid moves were required to combat inflation and its worst fallouts. But in the absence of co-ordination between various financial policy-making agencies, some policies seem to work against each other. For instance, the central bank was trying to drain liquidity from the economy while the Government was still increasing public expenditure.
To ensure everyone pulls in the same direction, the Prime Minister has set up a system that provides an overview of the economy.
Public spending needs to be tightened because we know its effectiveness is not usually high. Besides, it is a breeding ground for corruption.
But it is not easy to tighten public expenditure because it plays a key role in ensuring economic growth in developing countries. If the Government does limit public spending, GDP will most likely take a hit.
Record trade deficit
Over the first two months of this year, trade turnover reached US$13 billion, an increase of 63.7 per cent in comparison to 2007. The trade deficit was $4.3 billion or 49.2 per cent of export turnover, triple what it was in 2007.
In response to the increasing rate of the trade deficit in recent years, the government has taken measures to curb it. However, the number of imported goods has significantly increased and exacerbated the domestic inflation rate.
The combination of local demand for imports and higher demand during the Tet festival pushed prices up. Meanwhile, import taxes on some commodities were sharply cut, especially for automobiles. According to recent figures, the number of imported automobile seating 12 or less people increased 10-fold.
To reduce the trade deficit, the Ministry of Industry and Trade is preparing to submit to the government a group of measures to limit imports and promote exports, particularly high valued-added products.
However, the decline of the international economy, especially in the US, which is a major market for Viet Nam, will limit the growth of exports.
In addition, besides importing necessary material for production, Viet Nam continues to import many household commodities that can be locally produced. The country also imports backwards technology, which could turn it into a junk yard for unwanted goods.
This year may see a record trade deficit for the country at $18 to $20 billion. — VNS
Restraints for stock trading on both bourses adjusted
| 17:32' 03/04/2008 (GMT+7) | ||
Accordingly, from April 7, the margin for stock trading on the Ho Chi Minh City Stock Exchange is temporarily adjusted from ±1% to ±2% while that on the Hanoi Securities Trading Centre will be increased to ±3% from the current ±2%.
SSC said it will gradually widen the trading bands in the coming time based on the stability of the market.
This is the second time the margins have been adjusted.
From March 27, SSC reduced the collars for stock trading on both bourses from 5% to 1% for the HOSE and 10% to 2% for HASTC in order to calm down investors, limit them from rushing to sell shares as the stock market had dropped sharply for consecutive sessions.
After a short time, the measure has had a positive impact on the market, thus, the SSC has decided to increase the trading bands in order to increase market liquidity.
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Wednesday, 2 April 2008
PM emphasizes disiflation, macro-economic stability, social welfare and sustainable growth
| 04:06' 03/04/2008 (GMT+7) | |||
VietNamNet Bridge - Inflation curb is the Government’s top priority. Because inflation, if not put into control, will negatively influence production, people’s life, macro-economic stability, and long- and medium-term economic growth, deteriorating employment and investment environment, said PM Nguyễn Tấn Dũng.
PM urges to curb inflation, stabilize macro-economy and maintain social welfare and sustainable growth PM Dũng clearly pointed out that, due to complicated changes of the world economy and some internal causes of the domestic economy, the first quarter of 2008 saw a high inflation rate. Consumption price rocketed by 9.19% in March compared to December 2007 and the trade gap reached over US $7 billion in favor of import, equivalent to 56.5% of export turnover. These actualities made negative impacts on production, people’s life, macro-economic stability, and business environment.
In its March regular meeting, the Cabinet set it major task to curb inflation, stabilize macro-economy, and maintain social welfare and sustainable growth. “Inflation curb as our top priority, that means we should not run after growth norms set in late 2007. Instead, we should do our best to put inflation into control and decelerate price increase,” stressed the PM. PM Dũng stated that the Government was determined to take seven key solutions: (1) Tighten the purse strings while ensuring the market liquidity and banking system’s operation; (2) Reduce public investments and regular expenses of budget-used agencies, strictly manage investments conducted by State enterprises, and reduce budget deficit; (3) Promote agro-industrial production; (4) Ensure the commodity demand-supply balance, boost export and narrow the trade gap; (5) Enhance thrift practice in production and daily life; (6) Tighten market management to prevent speculation of primary goods; and (7) Further implement policies on social welfare. Concluding the article, the PM affirmed that, it is essential to effectively curb inflation and minimize its consequences through the participation of all State management bodies and authorities at all echelons. He also urged the whole political system, business community, mass media and the entire people to support and join efforts with the Government to fulfill this task. Following is the full text of the PM’s article: STRIVING BEST TO CURB INFLATION, STABILIZE MACRO-ECONOMY, ENSURE SOCIAL WELFARE AND SUSTAINABLE GROWTH By Nguyễn Tấn Dũng I We begin to put the socio-economic development plan 2008 into reality in the contexts of various complicated and unexpected changes in the world economy. The US economy is in serious recession: GDP increased by 0.6% only in the last quarter of 2007, much lower than previous quarters. The US economy is forecasted to grow by 1.5% in 2008. Some experts admitted that the US economy is entering the stage of recession. The US dollar has devalued compared to many other currencies; prices of most of goods in the world market are rocketing (1). The regression of the US economy, which accounts for 25% of the world’s total GDP and over 15% of the total import turnover, has seriously affected and led to the recession of other economies. Prices are sharply increasing in most of the countries, even in powerful economies where low prices have been maintained for years (2). Many countries have readjusted their growth rate by 1-2% (3). If the US economy falls in its cycle of recession, the situations are predicted to be more complicated. Up to now, Vietnam has been deeply integrating into the world economy. We have obtained the total export-import turnover equivalent to 160% of GDP, in which import accounts for nearly 90% of GDP. So, such unpredictable changes in the world market over the past time have negatively affected Vietnam’s growth as well as prices in its domestic market, at a stronger level in comparison with the previous stages and with other countries. Vietnam, during 2006-2007, suffered successive damaging natural calamities and epidemics (economic damage was estimated to be VND 33,600 billion). At the beginning of this year, a prolonged spell of harsh cold in North and Central Vietnam caused great material losses for people’s life and agricultural production (4). In such external and internal realities, weaknesses of the national economy and the economic structure have been exposed, becoming big challenges to the economic management and development. To overcome the situations, the whole people and business community have done their utmost and made use of their strengths to deal with difficulties, maintain socio-political stability, and improve the investment and business environment, laying a solid foundation for higher growth in long and mid-terms. We were able to obtain the GDP growth rate of 7.4% in the first quarter. However, due to complicated changes of the world economy and some internal causes of the domestic economy, the first quarter of 2008 saw a high inflation rate. Consumption price rocketed by 9.19% in March compared to December 2007 and the trade gap reached over US $7 billion in favor of import, equivalent to 56.5% of export turnover. These actualities made negative impacts on production, people’s life, macro-economic stability, and business environment. II In its regular meeting in late March 2008, through thorough discussions, the Government agreed to set its major task to curb inflation, stabilize macro-economy, and maintain social welfare and sustainable growth. The inflation curb is considered the Government’s top priority. Inflation, if not put into control soon, will negatively influence production, people’s life, macro-economic stability, and long- and med-term economic growth, deteriorating employment and investment environment. Saying inflation curb as our top priority, that means we should not run after growth norms set in late 2007. Instead, we should do our best to put inflation into control and decelerate price increase. In this spirit, the Government plans to ask the National Assembly to reduce the growth norms and readjust the inflation index commensurate to the realities. Such readjustment is necessary to focus on the top priority, bringing about good preconditions for high and sustainable growth in the following years. The Government has been concentrating on directing the realization of these main tasks and top priorities. To fulfill the above-mentioned tasks and goals, the Government agreed to take the following solutions in a consistent and drastic way: First, tighten monetary policies. Among numerous causes of inflation is always monetary one. The monetary supply and credit debt balance continuously increasing since 2004 and sharply went up in 2007 are important causes of inflation. Being aware of this, the Government decides to strictly control the total means of payment and the total credit debt balance right at the beginning of this year. The State Bank must soundly exploit flexible monetary tools and policies in line with the market rules in order to fulfill this goal. It is important to maintain the economy’s market liquidity and the performance of banks and credit organizations to facilitate production and export activities. Second, reduce public investments and regular expenses of budget-used agencies, strictly manage investments conducted by State enterprises, and reduce budget deficit. The investments using the State budget and carried out by State-run enterprises currently account for 45% of the total social investment. By reducing this source, the demand pressure and trade gap will be lowered, helping to raise the economy’s efficiency. The Government will present specific reductions applied for investment capital and administrative costs. All ministries and local authorities are required to find out ineffective or unnecessary projects. This work will be drastically conducted, even in reallocating and balancing the capital sources. In this spirit, the Government urges all ministers and chairpersons of all centrally-administered provinces and cities, as representatives of the State ownership, to strictly supervise investment items made by State-run enterprises and resolutely remove ineffective ones. Meanwhile, the projects about to be finished or those on commodity production must be facilitated and put into operation as soon as possible. Third, promote agro-industrial production and quickly handle all consequences caused by unfavorable weather and epidemics in order to raise food output. At present, Vietnam’s potential to develop is great, especially after fully joining the World Trade Organization membership. Foreign and private investments are strongly going up; export market is expanded. Thus, it is a basic solution to boost production in order to increase supplies to the domestic market and exporters, curb inflation, narrow the trade gap, and give a push to economic growth, without any side-effects. The Government assigned ministers and provincially-level chairpersons to timely lift all difficulties in terms of capital, market and administrative procedures in order to promote production activities. Fourth, ensure the goods demand-supply balance, boost export and narrow the trade gap. The demand-supply balance of goods, especially primary ones for production and people’s life, is a decisive precondition to prevent sudden price increase and speculation. The Prime Minister and ministers have been working with associations and enterprises trading in primary commodities (food, medicines, petroleum, steel, building materials, fertilizers) and assign them to keep supplies and prices in control. While executing the consistent policy to adopt a market price mechanism and abolish all price subsidies, the Government decided not to put up prices of electricity, coal, petroleum and stabilize those of cement, fertilizer, clean water, medicines, train and air tickets until late June. The Ministry of Finance was entrusted to consider some fee reductions for farmers. To guarantee food security and restrain the price escalation of food at home, the Government fixed the 2008 volume of rice export at 4 million tons and not more than 3.2 million tons by the end of the third quarter. The Government assigned the Ministry of Finance to propose a plan to raise export tax imposed on coal and crude oil as well as consider possibilities to impose export tax on rice. The US dollar is devaluing in comparison with the currencies of the countries which are Vietnam’s export markets and the current exchange rate between Vietnamese dong and US dollar not reflects the real relationship in the foreign exchange market. So, the Government intended to apply a flexible exchange rate with proper margins, as a means to curb inflation in favor of export and the trading of foreign currencies. The trade balance is a very important macro index. The excess of imports over exports in 2007 and the first quarter is threatening the macro-economic balance. This situation must be settled through boosting export and controlling import. The Government is directing the realization of various solutions: The State Bank must provide a sufficient source of capital to exporters, purchase all of their foreign currencies, and immediately deal with credit obstacles. It must also further support trade promotion for exports; boost administrative procedures reforms in export activities to reduce costs and improve competitiveness of Vietnamese exports; and apply technical barriers and other measures in conformity with Vietnam’s international commitments, even raising import tax on unessential goods. Fifth, enhance thrift practice in production and daily life. At present, the prodigality is quite popular in production activities and daily life. The possibility for thrift in production and consumption is extremely high. So, the Government requests all State agencies to cut down 10% of their administrative expense and all enterprises to check their expenditures in order to down cost price and circulation fee. The Government calls upon everyone and every family to save fuels and energies. This solution will help to reduce the demand pressure and trade gape as well as increase the production efficiency. Sixth, tighten market management and supervise the obedience of laws on price. We must prevent speculation of primary goods (especially petroleum, steel, cement, medicines, and food) and cross-border smuggling (particularly petroleum and minerals). Businesses in all economic sectors must regularly check the selling price applied by their retailers and agents. The Government ordered State-run corporations to take the initiative in observing this task and be responsible to the Government for the operation of retailers and agents. The Government also asked associations to actively take part in and support these policies and solutions to stabilize the market and prices. Seventh, further implement policies on social welfare. The price escalation has been affecting people’s life, especially the poor and disadvantaged households, natural calamity-stricken victims, and low-income laborers. So, the Government concluded to enlarge its policies on social welfare. The Government decided a 20% increase in the minimum salary of employees in State agencies, armed forces, political and socio-political organizations since January 01, 2008. The Government also decided to raise the minimum wage for Vietnamese employees working in foreign-invested enterprises, foreign and international agencies/organizations in Vietnam, for foreign individuals working in Việt Nam, for laborers working for all Vietnamese companies, enterprises, cooperatives, farms, households, individuals and other labor-using entities. For trained laborers (including those trained by enterprises), the minimum salary was at least 7% higher than the regional minimum wage. Besides, pension and social insurance allowance was raised by 20% for about 1.8 million retired people and over 1.5 million contributors to the revolutionary cause. Recently, the Prime Minister issued Decision 289/QĐ-TTg on some policies to assist ethnic minority people, beneficiaries of social policies, poor households, and fishermen. Accordingly, an annual sum of money equivalent to 5 liters of kerosene will be given to ethnic minority people and poor households in the localities out of the electricity coverage; the pension for health insurance for the poor is raised from VND 80,000 per person per year to VND 130,000; 50% of the nominal value of health insurance cards is subsidized for members from the sub-poor households who purchase voluntary health insurance; fishermen are partly funded to buy or build their new fishing boats or other ships to serve aquaculture; they are financed to replace their ship engines with fuel-saving ones; the insurance costs for the hull of fishing boats or other ships to serve aquaculture and for accidents suffered by contracted sailors will be partly granted; fuels will be supplied to fishermen who own fishing boats or service ships. The Government decided to stabilize tuition fees and hospital fees as well as grant preferential loans to disadvantaged students of universities, colleges, and vocational schools. Natural calamity-stricken households will be provided with rice allocated from the national reserve, without any fee (5). At the same time, we should speed up the implementation of national goal programs and other supportive measures in disadvantaged areas. It is important to pay set up an effective supervision mechanism to ensure that the State aid is not peculated. III Disiflation is a hard duty. To successfully curb inflation and minimize its consequences, it is essential to mobilize the participation of all State management bodies and authorities at all echelons. The world market is changing, so it is necessary to update information to be able to timely take accurate measures in order to minimize negative impacts and make full use of new opportunities for the country’s development. The Government is fully aware of its responsibility to the whole people for deflation. However, this work will be conducted with best results through great support and joint efforts from the entire political system, business community, mass media and all people. The tasks are tough, difficulties and challenges are big, but good chances and potentialities for higher economic growth are great. We are confident that, under the leadership of the Communist Party of Vietnam and with great determination and joint efforts of the whole nation, we will succeed in curbing inflation, stabilizing the macro-economy, maintaining social welfare and sustainable economic growth, and fulfilling the 5-year plan 2006-2010 put forth by the 10th Party Congress. N.T.D (1) Price of crude oil in the first quarter of 2008 increased by nearly 40% compared to the average price in 2007 and is predicted to maintain high. It is even forecasted to reach higher, up to US $150/barrel. Price of steel in early 2008 went up by 45.1% against late 2007, currently US $900/ton. Prices of urea fertilizers, wheat flour, and rice doubled in March 2008 in comparison with last year. (2) Consumption price in China in February 2008 rose up 8.7% against the same period of 2007. Meanwhile, the increase was 2.7% in February 2007 compared to February 2006. In Thailand, the figures were 5.41% against 2.32% respectively; Philippines 5.36% against 2.64%; and the Euro-using market 3.2% against 1.84. (3) In 2008, many countries have readjusted their growth norms to cope with the situation: the USA 1.5% (last year 2.7%); Euro-using market 1.6% (2.6%); Japan 1.5% (1.9%); China 8% (11.4%). (4) During the harsh cold spell in early 2008, about 200,000 ha of rice, 18,000 ha of rice seeding, 25,000 ha of vegetables were damaged, and 180,000 heads of cattle froze to death. The total loss was estimated to reach VND 1,000 billion. (5) In 2007 and first three months of 2008, nearly 80,000 tons of rice from the national reserve were provided to victims of natural calamities, without any fees. |
ADB forecasts 7% growth for Vietnam
| 06:56' 03/04/2008 (GMT+7) | ||
The forecast is from the Asian Development Outlook 2008 that ADB released the same day, one day after the World Bank announced its six-monthly review that projected the country’s economic growth at 8 percent (a base case scenario) for this year. |
VN-Index hints at turnaround
(31-03-2008)
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| Investors eye the board at Habubank Securities in Ha Noi. Markets rallied modestly for three consecutive days last week. — VNA/VNS Photo Tran Viet |
HA NOI — With the a tighter daily trading band announced last Tuesday and put into effect on Thursday, shares rallied modestly for three consecutive days last week, with many market watchers saying that confidence was gradually returning in the market.
The VN-Index closed on Friday at 512.70 with most codes hitting their ceiling price. This was off last week’s close of 545.68.
Over the course of the week, eight codes saw gains, while 136 declined and nine remained unchanged.
Trading value on the week was shy of VND2.6 trillion on a volume of only 50.8 million shares, 40 per cent less than volumes in the previous week. The loss was blamed on the tighter daily trading band’s restriction on market liquidity.
The VN-Index fell below 500 at the close of trading on Tuesday morning, ending the day at only 495.02, spurring the State Securities Commission to institute the tighter trading band as a measure to stanch further losses.
The commission narrowed the daily trading band from 5 per cent to one per cent, plus or minus, on the HCM City Stock Exchange, and from 10 per cent to 2 per cent at the Ha Noi Securities Trading Centre.
On Wednesday, the last day of trading without the restricted trading band, the VN-Index broke back above 500.
This, and the subsequent two days of gains, surprised many analysts who had expected investors to hastily sell off their shares. Only foreign investors behaved as predicted, becoming net sellers on Thursday and Friday.
In the history of Viet Nam’s stock market, the daily trading band was changed five times between 2000 and 2002. In June 2001, the State Securities Commission loosened the trading band from 2 per cent to 7 per cent. The VN-Index rallied for six consecutive sessions before plummeting to a record low of 203 points.
The commission once again narrowed the trading band from seven per cent to two per cent in October 2001 with a view to curbing inflation and making investors feel more secure. The adjustment caused many investors to simply hold onto their shares, resulting in low trading volume, and it took the VN-Index 19 consecutive trading sessions to climb back nearly 300 points.
To ease the oversupply of shares on the stock market, the State Bank has also required commercial banks not to sell off shares they hold as collateral and help reduce losses they would suffer if they sold.
Decreasing the number of shares on the market and increasing compulsory reserve requirements imposed on commercial banks, if handled smoothly, would also help ensure the payment capacity of banks and balance the supply and demand of shares. — VNS
