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Posts Tagged ‘costs’

Local businesses borrow at any costs for booming time at yearend

In Uncategorized on December 16, 2010 at 10:05 am

Financial experts said many businesses would be willing to borrow money at the current rates as they need large sources of capital at the end of the year, which is expected to be a booming time of the local retail market.

A cash teller (left, in blue) talks with a client at the Asia Commercial Bank (Photo: Minh Tri)

At some commercial banks, deposit rates reached 15-16 percent per annum last week, while lending rates for businesses and individuals are up to 17-19 percent and more than 19 percent.


Some small and medium enterprises disclosed lenders’ current lend rates remained much lower than unofficial sources’ ones, which can be up to 3-4 percent per month or 48 percent per annum.


High interest rates showed commercial banks’ credit growth last month was a little bit slower than previous months, according to Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s Ho Chi Minh City branch.


He expected the banks’ more steady liquidity combining with local firms’ large demand for capital this month will put the growth rate back on track.


However, the central bank’s HCMC branch noticed in a report that interbank rates still reply mainly on the state-owned lenders. Commercial banks and financial firms are often clients of the state-run lenders. The interbank rates therefore will increase rapidly if  the state-owned banks, in some cases, refuse to give loans to commercial lenders, the report said.


The state-owned lenders mostly have to say no to commercial banks or financial firms, whose plans on using capital are risky and unreasonable.


Economists said many lenders’ growth rates nearly reach their annual target, so they will be unwilling to loan more.


The credit growth rate of the Military Bank was 5 percent higher than October’s rate and rose 50 percent so far this year. The lender had to slow down last month’s growth rate as they were afraid it would surge over this year’s target, an officer at the bank said, without providing how much the targeted rate is.


The state bank’s HCMC branch expected credit growth rates this year would rise 25 percent year-on-year to VND699.81 billion (US$35 million), and the deposit would increase 27 percent year-on-year to VND766.25 billion ($38.3 billion).


However, some banks will likely to miss their target. Asia Commercial Bank, known as ACB, said the number of personal loans was small because of the high interest rates. Other commercial lenders said they still accepted personal loan applies, but would offer the loans next year.

Source: SGGP

BP’s costs soar as storm delays oil containment

In Uncategorized on June 29, 2010 at 8:47 am

NEW ORLEANS, Louisiana, Jun 29 (AFP) – BP’s costs soared as a major storm stymied efforts to double the amount of oil captured from a ruptured well deep in the Gulf of Mexico.


Tropical storm Alex, the first major storm of the Atlantic hurricane season, appeared set to sidestep the massive slick, but its strong winds made seas too rough to attach a third vessel to siphon oil from a containment cap some 5,000 feet (1,500 meters) below the surface.

AFP/Getty Images/File – Pete Duchock holds his daughter, Maddie Duchock, as they stand near oil residue

Rough seas could also push the oil deeper into fragile coastal wetlands and has already shifted parts of the slick closer to sensitive areas in Florida and Louisiana, said US Coast Guard Admiral Thad Allen, who is overseeing the response efforts.


“Any kind of a surge or a storm would obviously exacerbate the oil further into marshes, which would cause problems, and we’re going to face that potential throughout the hurricane season,” he told reporters.


Even the threat of gale force winds — upward of 45 miles (72 kilometers) per hour — will suffice to force drilling and containment ships to withdraw from the spill site some 52 miles (83 km) off the coast of Louisiana, Allen said.


Evacuations must begin 120 hours in advance, and operations will be shut down for about two weeks to “take down the equipment, move it off to a safe place, bring it back and reestablish drilling,” Allen said.


That would delay the completion of relief wells designed to permanently plug the well until September, and would drastically increase the flow of oil still gushing into the sea some 70 days after the deadly explosion on the BP-leased Deepwater Horizon drilling rig.


The current containment system is capturing nearly 25,000 of the estimated 30,000 to 60,000 barrels of crude gushing out of the ruptured well every day.


The now-delayed Helix Producer vessel was set to increase containment capacity to 40,000 to 50,000 barrels per day by early July.


Former US president Bill Clinton said blowing up the well “may become necessary” and expressed concern about the ultimate success of the two relief wells currently being drilled.


“This is a geological monster,” Clinton told CNN.


“You could stop that well, but what else might you do that might upset the ecostructure of the Gulf?”


But BP vice president Kent Wells said the energy giant has a “high degree of confidence in the relief wells.”


The first well, which stretches over 16,700 feet (5,090 meters), is now only 20 horizontal feet (six meters) away from the original well, Wells told reporters.


Engineers will drill parallel to the original well for about another 1,000 feet (305 meters) before trying to cut into it and cap it with heavy drilling fluids known as mud and concrete.


“I’m really confident in the team’s chance of being successful here,” Wells said.


BP earlier raised its costs over the oil spill to 2.65 billion dollars, an increase of about 300 million dollars over the weekend that means the energy firm is now forking out about four million dollars an hour.


The firm was also forced to deny reports its chief executive Tony Hayward was set to resign after weeks of taking flak for a string of gaffes and insensitive remarks about the disaster.


Meanwhile, Tropical Storm Alex gained strength as it moved into the southwestern Gulf after dumping heavy rains across the Yucatan peninsula, having killed at least 10 people in Nicaragua, Guatemala and El Salvador.


On its current path, Alex is projected to make landfall in Mexico late Wednesday, with most of its force avoiding the oil spill area in the northeastern Gulf off the Louisiana coast.


Alex, which already packed maximum sustained winds of 65 miles (100 km) an hour, was “gradually strengthening,” and is expected to become a hurricane on Tuesday, the Miami-based National Hurricane Center said.


OPEC urged the United States to reconsider legal moves and ditch a ban on deepwater drilling slapped on the oil industry in the wake of the Gulf of Mexico oil spill disaster.


Vice President Joe Biden heads to the region on Tuesday and is due to visit the New Orleans command center before traveling to the Florida panhandle.

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Source: SGGP

New home costs beyond reach of Hochiminions

In Uncategorized on June 21, 2010 at 4:36 pm




New home costs beyond reach of Hochiminions


QĐND – Monday, June 21, 2010, 22:26 (GMT+7)

Houses and apartments in Ho Chi Minh City have become so expensive that people must scrimp and save for ten years to afford them, according to Saigon Tiep Thi newspaper.


Nguyen Hoang Hai is a communication worker for a foreign company in HCM City.  Though the young native of Ben Tre earns seven million dong a month, he can’t yet afford to buy a house for himself in the southern metropolis.


Hai can save two million dong a month ($105) after covering his basic needs, but an apartment costs nearly one billion dong ($19,000).  Hai calculates that after 10 years, if he does not have to spend money on healthcare, does not get married, gets promoted every year, and apartment prices don’t change, he can buy a home.


Tran Hung, 31, relates that he and his wife live in a rented flat because he cannot buy one.  The couple has savings of 300 million dong and have dreamed of having an apartment of his own. However, the cheapest apartment that Hung’s been shown, a 22 square meter flat in Binh Tan district, was priced at 500 million dong.  For now, Hung and his wife have decided to rent an apartment for three million dong a month.


Hung learned that the apartments with an area of up to 100 square metre now are being offered at 16-17 million dong per square metre. “At such prices, owing an apartment is just a dream for us,” Hung said


Director Tran Quang Tuan of Minh Khoa Construction Company says those who have just graduated from university don’t have incomes sufficient to buy houses or apartments in big cities.  Most new graduates earn three to four million dong a month, but apartments are priced from 600 million to 1.5 billion dong.


Even people who have a monthly income of five to ten million dong, still find it difficult to buy houses.  Few are able to borrow, because the banks set high ‘free cash’ requirements on those who seek to finance purchase of a house or apartment.  After the banks deduct the cost of meals, electricity and water, internet service, money sent ‘home’ to parents and income tax, few can qualify.


Yearly per capita income in HCM City in 2009 was over 40 million dong ($2100), or more than  twice the national average.  According to the Ministry of Construction, a 50 square metre low cost apartment now costs between 500-600 million dong. This means that only people with average income who abstains from eating or drinking for 10 years can save enough to buy a home in HCM City.


Many apartment projects in the city’s suburbs are introduced as ‘having soft prices’. However, even these ‘low cost apartments’ typically bear prices in the ten to fifteen million dong per square metre range.  At the Le Thanh project apartments in Binh Tan district, for example, prices are set at ten to eleven million dong per square metre. ‘E-Home’ project flats in district 9 are offered at 11.8 million dong per square metre.

Source: Saigon tiep thi

Source: QDND

China wage hikes boost costs but might help sales

In Uncategorized on June 9, 2010 at 12:23 pm

The cost of hiring Chinese workers who supply the world with inexpensive furniture and toys is climbing. But workers with more money to spend is good news for foreign companies that see them as customers, not just factory labor.


Areas throughout China have raised local minimum wages and some foreign employers have given out hefty pay hikes. That, combined with an expected rise in China’s currency against the dollar this year, will squeeze exporters of clothing and other low-margin goods, possibly forcing thousands to close or move to cheaper countries such as Vietnam.


“It is very difficult for us,” said Danny Lau, chairman of the Hong Kong Small and Medium Enterprises Association. He said some 2,000 to 3,000 of an estimated 50,000 Hong Kong-owned factories in southern China’s Pearl River Delta, an export hub, might close this year.

In this photo taken on Feb. 24, 2010, a recruiter talks to job seekers near a sign which reads ‘Foxconn Technology Group Recruitment Point’ in Shenzhen in south China’s Guangdong province

But putting more money in workers’ pockets will help turn them into consumers and accelerate China’s growth as a major market for imports from Boeing jetliners to Brazilian soybeans.


“This is good news. It’s going to start driving consumer spending,” said Standard Chartered economist Jinny Yan.


Beijing and other Chinese cities have raised minimum wages by up to 20 percent as part of efforts to narrow a yawning income gap that communist leaders worry is fueling political tensions. It was the first rise since the minimum wage was frozen in 2008 to help exporters hold down prices amid the global crisis.


Communist authorities who normally bar independent labor activity have allowed workers to demonstrate and sometimes carry out brief strikes for higher wages.


On Sunday, Taiwanese-owned Foxconn Technology Group announced the second in a series of raises that would increase pay by up to 65 percent at its factories in the southern city of Shenzhen. The company employs 300,000 people there making iPhones and other goods for Apple Inc., Sony Corp., Dell Inc., Nokia Corp. and Hewlett-Packard Co.


The wage hikes fit Beijing’s economic strategy, which calls for encouraging China’s own consumers to spend more in order to reduce reliance on exports and investment to drive growth.


The ruling party also is trying to shift more money down the economic ladder to defuse public anger that Chinese workers have gotten too little out of a boom that has created dozens of billionaires.


Wages as a share of China’s gross domestic product have fallen steadily since the 1980s, from 56.5 percent in 1983 to 36.7 percent in 2005, according to figures from the umbrella group for legally permitted unions, the All-China Federation of Trade Unions, reported by the government newspaper Global Times.


Even at that level, rising incomes made China the biggest auto market last year by vehicles sold and a leading market in industries from air travel to fast food. Retail sales in April were up 18.5 percent from a year earlier.


“Demand is picking up because people have more money in their pockets,” said Jing Ulrich, JP Morgan’s chairwoman for China equities. She said higher wages could boost demand for products as varied as fast food and sporting goods.


Foreign companies’ focus on China as a market was highlighted by a survey released in April by the American Chamber of Commerce in China. It found the top priority for 58 percent of its member companies was producing in China for sale to local consumers. Only 14 percent said their priority was to produce for export.


The wage hikes are likely to hit employers hardest in China’s southeast. The area has thousands of factories, many owned by Hong Kong or Taiwanese investors that compete in global markets. Many have razor-thin profit margins and little power to pass on higher costs to customers.


The region was battered in 2008 by the collapse in global consumer spending. Thousands of factories closed and the government said as many as 30 million people were thrown out of work.


Wei Senchuan, general manager of Suzhou Hong Sheng Printing Co. in the eastern city of Suzhou, which makes housings for computers bound for export, said the minimum wage rise will add 6 to 7 percent to his costs.


Asked whether he could pass that on to customers, Wei said, “impossible.”

Even after the latest increases, Chinese wages are still a fraction of those in the United States or Europe. Foxconn says pay for its employees in Shenzhen will be about 2,000 yuan ($293) a month.

“We don’t see an end to an era of cheap Chinese goods,” said Yan of Standard Chartered.

The minimum wage hikes should raise growth in domestic consumption by about 0.2 percentage points this year, according to Jun Ma, chief China economist for Deutsche Bank. He said that would come at the cost of a 0.4 percentage point rise in inflation and a 0.6 percentage point decline in exports.

The wage hikes “will serve as an important impetus to speed up the income distribution reform and economy upgrading,” Ma said in a report.

Taiwanese companies had invested an estimated $122 billion and employed 14.4 million people on the mainland as of last year, according to Hung Chia-ko, a researcher at Taiwan’s National Chengchi University.

Some are shifting operations to Southeast Asian nations such as Vietnam and other low-wage economies. But many are too dependent on China’s networks of distributors and materials suppliers, say economists and company managers. And even in such places as Vietnam, with 80 million people, the labor pool seems small by comparison.

“Vietnamese workers go on strike every day,” said Andrew Yeh, head of the Dongguan Business Association of Taiwan Investors in Dongguan, a city near Hong Kong, and the boss of a company that makes computer cables.

“And you have to be close to the market,” Yeh said. “How do you set up your base in Vietnam and export to China?”

Source: SGGP

Milk prices rise despite lower costs

In Uncategorized on December 4, 2008 at 1:39 pm







Several dairy product producers and importers have raised prices despite a drop in the cost of raw materials in recent months. — VNA/VNS Photo Anh Tuan

HCM CITY — A number of dairy product producers and importers have raised prices despite a drop in the price of raw materials in recent months.


Hanco Food Joint Stock Co deputy director Pham Ngoc Chau called the increase “unreasonable” in light of falling prices on the global market.


The price of skim milk powder has fallen by about US$1,000 per tonne to around $2,700-2,800, while whole milk powder was selling for $3,800 per tonne.


By jacking domestic prices, dairy importers were earning windfall profits, Chau added.


Meanwhile, the higher wholesale prices were being passed on directly to retail consumers.


The distributor of the Abbott milk brand in Viet Nam, 3A Pharmaceutical Products Co Ltd has raised the price of a 900g can of Pediasure BA milk powder by VND29,000 to VND352,000.


Le Huu Binh, deputy director of 3A, said the price hikes applied to new products with superior quality.


But a 900g can of Nestle’s Nan Pro milk powder has also gone up in price from VND325,000 ($19) to VND348,000 ($20.50), and the price of a can of condensed milk has risen by VND690 to VND3,800, depending on the brand, according to Citimart deputy director Ngo Van Hai.


And more is coming. Vinamilk will raise retail prices on powdered milk and other powdered nutrition products by VND1,000-6,000, with Vinamilk deputy director Tran Bao Minh blaming the increase on rising costs of packaging and milk fat.


While many of the companies pushing up prices say new packaging designs or products with more nutrient additives were costing more, nutritionists were arguing that additives such as taurine and choline have little benefit.


Chau said the Government needed to inspect the retail market more carefully to ensure protection of consumer rights. —

Conservation plan to help reduce energy costs

In Uncategorized on November 13, 2008 at 12:12 pm

HCM City (VNA)– Vietnam can save at least 5 percent of its total energy needs by 2010 and dup to 8 percent by 2015 if a new energy conservation programme is approved by the Government.

The programme was discussed at a seminar held last week by the HCM City Energy Conservation Centre (HCM-ECC) and Energy Efficiency and Conservation Office (EECO).

Tran Viet Hoa, a representative from the Ministry of Industry and Trade, said the proposed National Programme on Energy Efficiency and Conservation would be submitted to the National Assembly next year for final approval.

The programme, among other measures, encourages the use of energy-efficient equipment used in households and industry and the creation of new laws on industrial power use.

Educating citizens about energy use, getting rid of low-efficiency electrical equipment, and encouraging power savings in construction and transportation are other objectives of the programme.

Hoa said the use of energy-saving labels in products, which the government encouraged last year, had been underused by companies.

Last year, only three companies registered to attach labels on their products, he said.

According to the EECO, the rate of electric power consumption per capita each year has increased dramatically, with 540kWh this year against 288 kWh in 2000.

Nguyen Thanh Phong, of HCM City Electricity Company said since 2006 the city had encouraged citizens to buy compact flu orescent bulbs which have been offered at low prices to more than 490,000 families.

By using such bulbs, monthly electric bills can bi cut by 15 percent.

This year the company has sold 84,000 bulbs, 70 percent of its target. The campaign will continue until 2015.

Vietnam ’s energy demands have risen dramatically in recent years as its industrial sector has developed.

The Vietnam Institute of Energy has predicted until 2020 the country would be capable of supplying 58-65 million tonnes of coal, 18-20 tonnes of oil and 83 billion kWh electric power each year.

But in 40 to 60 years fossil fuel sources in the country will be exhausted if the Government does not have specific strategies for energy conservation, according to experts.

A survey by the Ministry of Industry and Trade and HCM –ECC finds that Vietnam has great potential to save energy.

The cement industry could save 50 percent of energy consumed, the steel industry 20 percent, and the garment sector 30 percent, the ministry said.

Vietnam , however, uses more energy than other nations to make the same product, according to the ministry.

In addition, Vietnamese companies’ energy cost are at least 1.5 times more than those in companies in Thailand , China and Malaysia .

Nguyen Van Thuong, deputy general director of the Rang Dong Plastic Company, said energy expense represented 2 percent of the company’s product value.

Thuong said the company could save 30-40 percent in energy costs by replacing outdated industrial equipment.-

Conservation plan to help reduce energy costs

In Uncategorized on November 13, 2008 at 11:52 am

HCM CITY—Viet Nam can save at least 5 per cent of its total energy needs by 2010 and up to 8 per cent by 2015 if a new energy conservation programme is approved by the Government.


The programme was discussed at a seminar last week held by the HCM City Energy Conservation Centre (HCM-ECC) and Energy Efficiency and Conservation Office (EECO).


Tran Viet Hoa, a representative from the Ministry of Industry and Trade, said the proposed National Programme on Energy Efficiency and Conservation would be submitted to the National Assembly next year for final approval.


The programme, among other measures, encourages the use of energy-efficient equipment used in households and industry and the creation of new laws on industrial power use.


Educating citizens about energy use, getting rid of low-efficiency electrical equipment, and encouraging power savings in construction and transportation are other objectives of the programme.


Hoa said the use of energy-saving labels on products, which the government encouraged last year, had been underused by companies.


Last year, only three companies registered to attach labels on their products, he said.


According to the EECO, the rate of electric power consumption per capita each year has increased dramatically, with 540kWh this year against 288kWh in 2000.


Nguyen Thanh Phong, of HCM City Electricity Company, said since 2006 the city had encouraged citizens to buy compact flourescent bulbs which have been offered at low prices to more than 490,000 families.


By using such bulbs, monthly electric bills can be cut by 15 per cent.


This year the company has sold 84,000 bulbs, 70 per cent of its target. The campaign will continue until 2015.


Soaring demand


Viet Nam’s energy demands have risen dramatically in recent years as its industrial sector has developed.


The Viet Nam Institute of Energy has predicted until 2020 the country would be capable of supplying 58–65 million tonnes of coal, 18–20 tonnes of oil and 83 billion kWh electric power each year.


But in 40 to 60 years fossil fuel sources in the country will be exhausted if the Government does not have specific strategies for energy conservation, according to experts.


A survey by the Ministry of Industry and Trade and HCM-ECC finds that Viet Nam has great potential to save energy.


The cement industry could save 50 per cent of energy consumed, the steel industry 20 percent, and the garment sector 30 percent, the ministry said.


Viet Nam, however, uses more energy than other nations to make the same product, according to the ministry.


In addition, Vietnamese companies’ energy costs are at least 1.5 times more than those in companies in Thailand, China and Malaysia.


Nguyen Van Thuong, deputy general director of the Rang Dong Plastic Company, said energy expense represented 2 per cent of the company’s product value.


Thuong said the company could save 30-40 per cent in energy costs by replacing outdated industrial equipment—