New rules, market for Vietnam unlisted firms: officials

An investor sits watching share prices at a local securities trading floor in Hanoi

HANOI (AFP) — Vietnam will allow foreign investors to increase their stakes in non-listed companies and plans to set up a new trading floor for unlisted shareholding firms, officials said Friday.

The new ruling allows foreign firms to hold up to 49 percent of non-listed shareholding firms, up from 30 percent, said Vo Van Quang, office manager at the State Securities Commission of Vietnam.

Firms listed on the Hanoi and Ho Chi Minh City bourses have been allowed to hold stakes of up to 49 percent since 2005.

“This decision aims to widen and encourage indirect foreign investment in the Vietnam stock market,” Quang said.

The directive takes effect on June 1.

Vietnam also plans to launch a new trading floor in June for unlisted shareholding companies at the Hanoi Securities Trading Center, a senior government official told Dow Jones Newswires.

The new market is part of government efforts to help regulate the trade in unlisted companies’ shares, said the State Securities Commission official.

Vietnam has more than one thousand shareholding companies but less than half of those have been listed on either the Hanoi or Ho Chi Minh City exchanges, the official said.

http://www.google.com/hostednews/afp/article/ALeqM5jdImc1L1JLj0WTC9xr2c3wHo5eJw

Vietnam govt bond sales fail due to high yield bids

HANOI, April 17 (Reuters) – Vietnam’s State Treasury failed to sell any government bonds this week because bidders sought higher yields than the Treasury was prepared to accept, the Hanoi stock market said.

Five bidders at the auction on Thursday sought to buy 600 billion dong ($34 million) worth of two-year bonds at yields of between 8.2-9.5 percent but the treasury’s ceiling was 7.6 percent, the exchange said in a statement.

Two bidders also sought 350 billion dong worth of five-year bonds at between 8.8-9.2 percent, well above the State Treasury’s ceiling of 7.9 percent. The exchange did not name any bidders.

The State Treasury had hoped to raise 1 trillion dong in the bond sale to big infrastructure projects, such as roads, bridges and ports.

At the previous auction of government Vietnamese dong-denominated bonds on March 12, the Treasury also failed to sell any two-year and three-year debt.

The government has pledged 17 trillion dong ($956 million) in economic stimulus, including loan subsidies. State media have reported that more such policies were in the works, but it was unclear how they would be funded.

Government bonds were an option if policymakers relaxed their stance on yields, the Vietnam News quoted former central bank governor and National Monetary Policy Consulting Council member Cao Sy Kiem on Wednesday as saying.

“If we want a more successful bond issue, the yield should be raised,” Kiem said. ($1=17,780 dong) (Reporting by Ho Binh Minh; Editing by John Ruwitch)

http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSHAN45047420090417

PropertyWire: Vietnam faces office property crisis

VietNamNet Bridge – Vietnam is facing office property crisis as supply outstrips demand, said PropertyWire of the UK on April 13.

According to the global property news service provider, office rents in Ho Chi Minh City have plunged by up to 50 percent and the trend is expected to continue.

PropertyWire also cited various international analysts as saying that this trend is attributed to belt tightening due to the global economic downturn.

Global real estate companies Cushman & Wakefield, Savills and CB Richard Ellis said top quality office space rents have fallen to 43 USD per square metre this year from a peak of 70 USD per square metre at the beginning of 2008; second-class space rents down from about 45 USD per square metre to between 28 USD-40 USD and third-class office space from 39 USD to between 14 USD-25 USD.

PropertyWire quoted CB Richard Ellis managing director Marc Townsend as saying that office demand is closely linked with employment and financial stability and firms were tightening their belts, cutting jobs and also cutting costs on office rents.

The deteriorating situation is compounded by an increase in vacancies and 1.25 million square metre of new office space predicted to come into the market this year, adding to the downward pressure on rents, according to CB Richard Ellis.

VietNamNet/VNA

http://english.vietnamnet.vn/biz/2009/04/842006/

The poor need help through market reforms

The government’s leading priority should be increased support for the poor as they are set to pay the price of our new and sweeping market-oriented policies.

As a new member of the WTO, Vietnam is looking forward to fully integrating into the global economy.

The doors are open, investment is flowing in and development is underway.

But the early stages of reforms are always hard on those who need them most.

In the 1980s, the poor might have been poorer, but blanket state subsidies were still in effect.

Now, as we move towards a market economy, we’re cutting our subsidies.

We can still see the benefits of state support in the north right now.

The ongoing cold front has killed thousands of cattle, stripping whole communities of their livelihoods.

The government has been quick to provide households who lost their cattle VND1 million (US$62.6) each.

But our inflation problem is another story.

Soaring prices have hurt the poor more than anyone.

Many low-income households have had to start eating less.

Construction material price hikes have discouraged many flood victims in the central region from building new houses for their families.

In a bid to ease traffic jams, the government has slapped a ban on modified vehicles, effectively banning many young people’s meal tickets.

A plan to reduce Vietnam’s commercial fishing fleet by 36,000 vessels to protect marine life could bankrupt many fishermen.

Considering the host of tribulations the poor face, we, however, cannot re-adopt our old blanket subsidies.

Our most vital task is to help the poor help themselves.

Let us not move too fast.

Let Vietnam’s newfound economic success help those who need it until they are strong enough to stand on their own.

Remember, a chain is only as strong as its weakest link.

Let’s move slowly and make sure that every link is as strong as it can be.

- By Ngoc Minh of Thanh Nien News