Retail News CRM

Tag: asia

  • XPO awarded chilled warehousing contract for BrewDog

    XPO awarded chilled warehousing contract for BrewDog

    XPO Logistics has signed a contract with craft beer pioneer BrewDog, one of the UK’s fastest-growing food and drinks companies. XPO will provide class-leading temperature-controlled warehousing for BrewDog’s stockholding of craft beer at a multi-user, 125,000 square foot facility in Mossend, Scotland.

    The Aberdeen-based brewery – founded in 2008 by James Watt and Martin Dickie – has grown from a two-man team in 2007 to over 600 employees and ships beer to more than 55 countries around the world.

    “The team is bringing freshly filled bottles, cans and kegs from our production site to the facility in Mossend, where each batch is carefully chilled to a steady 8ºC and then assembled for onward distribution to BrewDog customers and our own chain of over 50 pubs across Europe,” said BrewDog’s Stephen McCrindle, customer service and logistics manager. He added, “The quality of our product underpins our business, and it’s important to us that we are in XPO’s experienced hands when it comes to managing our supply chain.”

    XPO has introduced a system interface between its enterprise software and BrewDog’s that improves stock visibility of kegs, cans, bottles and coasters, order processing speed and accuracy to create a more dynamic supply chain.

    Peter Fuller, XPO Logistics business unit director, said: “The growth trajectory of BrewDog has been phenomenal. The business previously operated on a ‘make it and sell it’ model using its own shared storage and production facilities, but it has now far outgrown these. We’re providing BrewDog with the sophisticated storage and supply chain facilities that a fast-growing company of this size needs.”

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  • Japan retailers’ profit growth slows to 0.6% in March-May

    Japan retailers’ profit growth slows to 0.6% in March-May

    Japan’s retail sector has seen earnings growth slow notably from a year earlier in the March-May quarter due to lackluster increases in sales combined with greater labor and other costs.

    The aggregate pretax profit of 61 retailers that announced their March-May results by Tuesday increased 0.6% on the year, according to a compilation. The figure, which translates to a nearly 3 percentage point drop from a year earlier, was the smallest over the past two years. About 40%, or 26 companies, booked profit increases.

    Are winners losing their grip?

    Convenience stores, which had been the winners in retail, are perhaps at a turning point. FamilyMart Uny Holdings, which was created through the merger between UNY Group Holdings and FamilyMart last September, said Tuesday its operating profit was 12.5 billion yen ($109 million), down 31% from the combined profits of its two predecessors a year before. Renovation costs were a major factor behind the profit drop, as the company turned some 750 Circle K and Sunkus convenience stores into FamilyMarts in the quarter.

    Lawson’s pretax profit declined even with a sales increase, partly due to the costs it shoulders for its store operators for the disposal of unsold packaged meals.

    Industry leader Seven-Eleven Japan was the only one among the top three players that booked profit growth. Its operating profit climbed 2% to 59.5 billion yen.

    Meanwhile, even within the same Seven & i Holdings group, general merchandise store operator Ito-Yokado struggled, with its existing-store sales shrinking 3.2%.

    “We will reform food operations by setting up a dedicated team,” said Yuji Kaneko, an executive officer of Seven & i.

    Aeon Retail, a general merchandise unit of Aeon group, sustained an operating loss for the quarter despite slashing advertising and other costs. The company cut prices of as many as 254 food and household items in April. President Soichi Okazaki says “sales would have slid even deeper were it not for the price cuts.” To spur sales, the company plans to lower prices again as early as August.

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  • Smart targets 70% LTE coverage by year end

    Smart targets 70% LTE coverage by year end

    The Philippines’ Smart Communications aims to make LTE services available in 70% of the population by the end of the year.

    A recent study from JP Morgan estimates that Smart’s nationwide LTE coverage reached 51.5% by the end of May, Smart VP of network planning and engineering Mario Tamayo said in a statement.

    Smart, the wireless division of PLDT, said the findings show that Smart is on track to meet the targets the company stipulated in the three-year network rollout plan the operator to the National Telecommunications Commission in July last year.

    The plan stated that the operator is targeting making LTE available to 95% of the company’s cities and municipalities by the end of 2018.

    The report also estimated Smart’s average broadband speeds at 11.1Mbps on a nationwide basis, ahead of rival Globe Telecom.

    Smart said it is currently re-equipping its cell sites to use low-frequency bands such as 700 MHz and 850 MHz to provide better indoor coverage, while simultaneously deploying high-frequency bands like 1800 MHz and 2100 MHz to increase the cell sites’ capacity.

    “We are asking for people’s patience and understanding as we are upgrading our network facilities. We assure you that we are taking steps to minimize the impact of these activities on our subscribers,” Tamayo said.

    “In the end, our commitment to all our subscribers is that they will enjoy progressively better mobile data services in the next few months, particularly for those using LTE devices.”

    To promote adoption of its LTE network the company has launched a new data package offer, Video Prime 99, that comes with 2GB of data and a subscription to the iflix and iWant TV streaming services. The offer is valid for seven days.

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  • China said to ban use of VPNs

    China said to ban use of VPNs

    China has reportedly instructed the nation’s operators to bar their customers from accessing the internet via VPNs by February in the latest move to tighten controls over internet access.

    State-run operators China Mobile, China Telecom and China Unicom have been ordered to bar their customers from using VPNs to skirt censorship restrictions, citing unnamed people familiar with the matter.

    The government is reportedly moving to remove loopholes enabling internet users to circumvent the so-called Great Firewall of China, the system that blocks access to a range of information sources including foreign social media and news websites.

    Many businesses also use VPNs to view restricted websites, and it is unclear how the new directive will affect multinationals operating within the country.

    If the clampdown is extended to businesses it could potentially discourage businesses from operating in China or even convince them to move their local operations, the report states. But the restrictions seem to be aimed mainly at individual consumers.

    If the restrictions are extended to businesses, it will add to the new regulatory burdens due to be introduced with China’s new Cybersecurity Law, which imposes strict restrictions on the transfer of data overseas for businesses operating in China.

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  • Bad news for Japan’s retailers as Chinese tourists cut back on buying

    Bad news for Japan’s retailers as Chinese tourists cut back on buying

    They’re still coming in droves — but no longer buying in spades. After propping up sales for overseas retailers over the past decade with a shopping-driven tourism agenda, Chinese visitors are no longer returning home with suitcases bulging like before.

    A new survey by consultancy Oliver Wyman shows Chinese tourist numbers and holiday expenditure continuing to rise last year, even as shopping during overseas travel dropped 17 percent from a year earlier.

    The average Chinese tourist spent about 6,705 yuan ($986) on shopping when traveling, down from 8,050 yuan in 2015. But overall holiday spending — including on hotels and sightseeing — rose 3.5 percent to 20,317 yuan from 19,635 yuan, according to the survey of 2,000 travelers from the mainland.

    The sea change in spending habits is dealing a blow to retailers from Parisian department stores to Japanese duty-free operators and Hong Kong jewelers, but bigger numbers of wealthier Chinese may create other opportunities for leisure and entertainment operators in popular overseas destinations.

    “Businesses globally have to adjust their strategy to think about how to capture the new Chinese tourist dollar,” said Oliver Wyman’s Shanghai-based partner, Hunter Williams. “It’s less about the outlet mall now and more about the national park.”

    One reason for the change is the easier access to foreign goods in mainland China due to a booming $60 billion cross-border e-commerce market.

    Imported items can now be ordered online and delivered in as quickly as a day, often exempt from taxes levied on goods from store shelves.

    That’s damped the practice of buying overseas for the purpose of reselling locally, and the survey showed such resales falling to 3 percent of shopping expenditures from 8 percent in 2015.

    Chinese outbound spending still ranks highest in the world. In 2016, travelers from the country spent $261 billion, a fifth of the global total, up from $249.8 billion in 2015, according to the World Tourism Organization.

    But the portion contributed by shopping has fallen to 33 percent of overall travel expenditure, from 41 percent in 2015, the Oliver Wyman survey showed.

    Chinese consumers no longer need to travel overseas to stock up on items from Playtex bras to Christian Dior lipsticks and Blue Nile diamond rings, which are now available on online portals run by firms like Alibaba Group Holding Ltd. and JD.com Inc. With foreign brands increasingly using the internet to reach Chinese buyers, foot traffic to malls and outlet stores in popular overseas destinations is slumping.

    Duty-free retailer Laox Co. reported a 33 percent fall in revenue for 2016 as Chinese tourists spent less, while U.S retailer Macy’s Inc. is shutting 14 percent of its stores to stem sales declines.

    Luxury houses like LVMH Moet Hennessy Louis Vuitton SE and Cie Financiere Richemont SA and brewer Kirin Holdings Co. have pointed to sales pressures from fewer Chinese shoppers visiting stores globally, said Bloomberg Intelligence retail analyst Catherine Lim.

    The survey also showed that more Chinese tourists are traveling with children and spouses rather than going alone or with friends. That could benefit destinations that offer unique leisure experiences or entertainment options, said Oliver Wyman’s Williams.

    “The number of Chinese tourists is still rising rapidly and at quicker pace than their overall spending,” he said. “This should give industry players some pause to think about how to make up for the loss of shopping-related spending through volume.”

  • Cebu Pacific seeks to increase Manila-Sydney flight frequency

    Cebu Pacific seeks to increase Manila-Sydney flight frequency

    Cebu Pacific (CEB), the only low-cost carrier servicing Manila and Sydney in Australia, has captured the largest market share for both passenger and cargo services on the route as of April 2017 and wants to increase its flight frequencies to this destination.

    Data from Australia’s Bureau of Infrastructure, Transport and Regional Economics (BITRE) showed that CEB flew 16,441 passengers in April alone, representing 41.8% of the total market share for the Manila-Sydney route, the highest among the three carriers flying this route.

    This brings the total number of passengers flown by CEB to 59,953 – representing 41.7% market share. Its closest competitor, on the other hand, captured 33.5% market share. Load factor for CEB for the Manila-Sydney route was at an average 80% for the first four months of 2017.

    Year-on-year, total passenger volume for the first four months of 2017 of all three carriers plying the Manila-Sydney route reached 143,765, up 12% versus the 128,352 passengers flown in the same period in 2016.

    For cargo service between Manila and Sydney, CEB captured 43.8% market share of the total 789 tons carried in April 2017. From January to April 2017, CEB had 47.4% market share of the total 3,114 tons of cargo carried for that route. The total cargo volume for the first four months of 2017, however, is 30.6% lower than the 2,128 tons carried in the comparable period last year.

    “Since opening the Sydney route in 2014, we have contributed to the growth of trade and tourism between the Philippines and Australia, through year-round low fares. Today, Sydney is one of our top international routes and bodes well for our future expansion plans in the Australian market,” according to Atty. JR Mantaring, Vice President for Corporate Affairs of Cebu Pacific.

    Cebu Pacific currently offers the most number of seats between Manila and Sydney, operating up to five weekly nonstop services between Sydney and Manila, departing every Tuesday, Wednesday, Thursday, Saturday and Sunday from Sydney at 11:35 a.m. and arriving Manila at 5:50 p.m.

    The flights from Manila to Sydney, on the other hand, depart at 12:05 a.m. and arrive Sydney at 10:05 a.m.

    Recently, the airline expressed interest to increase frequency between Manila and Sydney, noting strong demand for this route.

    Cebu Air, Inc. is the largest carrier in the Philippine air transportation industry, offering its low-cost services to more destinations and routes with higher flight frequency within the Philippines than any other airline. It also offers flights to over 60 destinations including Dubai, Tokyo, Beijing, Bali and Sydney.

    CEB’s 61-strong fleet, comprised of 4 Airbus A319, 36 Airbus A320, 8 Airbus A330, 8 ATR-72 500 and 5 ATR 72-600 aircraft, is one of the most modern aircraft fleets in the world. Between 2017 and 2022, Cebu Pacific will take delivery of 7 Airbus A321ceo, 32 Airbus A321neo, and 11 ATR 72-600 aircraft.

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  • AirAsia’s Shenzhen-Langkawi route starts Aug 9

    AirAsia’s Shenzhen-Langkawi route starts Aug 9

    AirAsia is expanding its connectivity by introducing direct flights from Shenzhen, China, to Langkawi starting Aug 9. Chief executive officer Aireen Omar said the concept of low-cost airline was introduced in Shenzhen with the aim of enabling more people to fly.

    “Now people in the Guangdong province are well-connected to the world through our extensive flight network of over 120 destinations in Asia, Australia, New Zealand and the United States,” she said in a statement.

    Since its inaugural flight in 2007, the airline has flown 4.3 million guests in and out of Shenzhen, bringing in high local and international passenger traffic into the city.

    Celebrating its tenth anniversary flying into Shenzhen, China, AirAsia was now offering 35 weekly flights from Shenzhen to South-East Asia.

    The average load factor for this year for the three routes from Shenzhen recorded a performance of over 85%, placing AirAsia as the leading foreign airline, in terms of flight frequency and passengers flown into Shenzhen.

    To celebrate the occasion, AirAsia is offering all-in fares as low as RM256 from Kuala Lumpur to Shenzhen and RM257 from Kota Kinabalu to Shenzhen.

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  • Quality blueberries the fruit of choice for Indonesians

    Quality blueberries the fruit of choice for Indonesians

    Australian fruit is proving popular with the Indonesian middle class. Premium fresh fruit is what seems to be in demand from Indonesia, especially that which has been grown for the Indonesian palate.

    Andrew Bell, director of Mountain Blue Farms in northern New South Wales, says the successful family-owned blueberry operation had been looking for export opportunities to expand beyond the domestic market, and eventually settled on Indonesia.

    The country has a population of more than 255 million, making it a potentially important market.

    “Indonesia has a significant population, right on our doorstep,” says Bell, whose company also runs its own breeding operation. “They also have a rapidly growing middle class who are a food and health conscious, and there happened to be existing protocols for getting blueberries into Indonesia.”

    He says the typical agribusiness approach into Indonesia had either been about bulk supply (wheat, sugar), or it had entailed lower grade fruit and vegetables for specific markets.

    “We saw a different market,” says Bell. “We wanted to be in the quality supermarkets that are being built for the middle classes. We have a premium product and that’s what we wanted to sell in Indonesia. We didn’t want to compromise on what we do.”

    The company representatives spent a week in Indonesia in early 2017, meeting supermarket operators, wholesalers and distributors.

    “They all dealt with Australian food imports, and their view of our produce was the clean and green image. It’s our image up there and that’s what the Indonesian operators are selling to consumers.”

    Health benefits

    It turns out that blueberries are a middle class food because of the number of health benefits associated with them. And with the Indonesian middle class already estimated at 50 million – and growing – that represented a market worth being involved in.

    The key, he says, was finding the right partners, which came in the form of a food distribution outfit in Java that was prepared to make specific recommendations about the Indonesian palate.

    “Blueberries come in many shapes and sizes,” says Bell. “The Indonesian palate goes for a large, crunchy, sweet blueberry.”

    Blue Mountain Farms has a breeding operation in Tabulam – on the Clarence River – and they set about breeding the Indonesian blueberry.

    Those samples are being fed into Indonesian supermarkets next month but the early feedback from the distributors has been positive.

    “It’s a very large market, for a product we can perfect and grow in regional Australia. We employ around a thousand people in the season and a core of between 60 and 70 staff, and we have a network of growers around the country who we use.”

    Bell says the chance to secure a foreign market is good for agribusiness employers and the towns they operate from. He also says that Indonesian business people are easy to deal with.

    “They know what they want and they know what works,” says Bell. “That makes it so much easier for us.”

    New tastes

    AsiaLink Business CEO Mukund Narayanamurti, says the example of Mountain Blue Farms is not an isolated one in Indonesia, as the health-conscious and food safety-aware middle classes of Indonesia develop new tastes for food.

    “The main food trade out of Australia into Indonesia is wheat, sugar, live cattle and boxed beef,” says Narayanamurti. “But this is large-scale or commodity trade. When the middle classes are growing – as they are very aggressively in Indonesia – you see rising demand for value-add premium foods, and for fresh fruit and vegetables.”

    He says Australia has a reputation in south-east Asia for its agricultural output, plus the Australian image for processed and value-add foods is one of quality.

    The demand from Indonesia is not only because middle class people have more disposable income, and higher standards for what they feed themselves and their children, says Narayanamurti. He says there are also new supermarket chains being built through urban Indonesia, where the value-add and premium foods are being sold.

    “In the Indonesian supermarkets there are Australian cherries, broccoli, avocados, Brussels sprouts, citrus fruits and kale.”

    He says Indonesia’s rising wealth and expectations is dramatic and the country is estimated to have a size of middle class in the world Top 10 by 2020. With the rising wealth comes the rising consumption of quality protein – Australian meat and dairy – and a focus on eating healthy and eating safe.

    Export opportunities

    Narayanamurti says one of the main reasons for Australian agribusiness operators to keep an eye on Indonesia is the export market itself.

    Australia’s involvement in the NZ-Australia-ASEAN zone gives exporters access to reducing-to-zero tariffs on beef, wheat and cheese and other trade goods that will be reducing.

    “The bigger picture is that this trade area covers 600 million people and a market of $US2 trillion ($2.6 trillion),” says Narayanamurti. “There is a trade liberalisation program meaning you’ll be able to land goods in one country and find it much easier to distribute them to other countries.

    “It’s early days in the south-east Asian market, but Australian agribusiness operators should be developing products and services that have cross border application, as the Australian breeding services and feedlot operators are already doing in the livestock sector.”

  • GAC China to provide upstream logistics services for car imports

    GAC China to provide upstream logistics services for car imports

    Parallel car importer Shandong High Speed Qingdao West Coastport has appointed GAC China its upstream logistics provider. Under the one-year contract, it will handle the receiving and checking, container loading and freight services of an estimated 3,000-4,000 cars exported from Hamburg and Rotterdam to Qingdao and Hong Kong every year.

    Simon Xu, managing director of GAC China, is optimistic about the growth of that market and the opportunities that it will generate: “China was ranked as the world’s number one automotive market for the eighth year last year, with a double-digit total sales growth. We are also seeing a rising trend for the direct import of European cars into the country.

    “Our partnership with Shandong High Speed marks the beginning of a new chapter for GAC China, that will allow us to leapfrog into a new territory in the contract logistics market for fully assembled automobiles.”

    GAC China’s contract logistics team led by manager Tyrone Liu will work closely with GAC’s partners in Hamburg and counterparts at GAC Rotterdam to ensure the safe and prompt delivery of the vehicles.

    Chengguang Du, general manager of Shangdong High Speed Qingdao West Coastport says: “When looking for a logistics partner with global resources and extensive experience to handle the shipment of our high value automobiles, GAC came to our mind. We know GAC as a well-known brand in the logistics industry, but it was only when we flew to Hamburg and saw the facility and operations with our own eyes that we were fully convinced.”

    GAC China has already handled the first shipment under the contract – two Range Rover HSEs from Germany to Qingdao, China.

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  • Singapore Myanmar Investco reports encouraging initial retail results at Yangon International

    Singapore Myanmar Investco reports encouraging initial retail results at Yangon International

    Singapore Myanmar Investco Limited has reported revenue of US$13.3 million in its travel and fashion retail segment for the year ended 31 March 2017.

    Subsidiary SMI Retail only began duty free operations at Yangon International Airport in September 2016, meaning there is little meaningful basis for year-on-year comparison. The company was awarded contracts for duty free, other retail and food & beverage outlets in 6,700sq m of space at the airport’s new International Terminal in December 2015.

    The 6,700sq m of retail space includes a multibrand and multicategory duty free area of almost 2,000sq m on three levels

    Singapore Myanmar Investco Limited reported overall group revenue of US$23.3 million for the year, and a gross profit of US$4.8 million. Net of tax, the company reported a loss of US$7.3 million.

    “The initial results of retail operations at Yangon International Airport are encouraging although it will take time for the new terminal to reach traffic flows at projected levels,” said SMI President and CEO Mark Bedingham in the company’s annual report.

    “We have received much positive feedback from passengers and the airport management company on the quality of the duty free and travel retail stores that we have created and this initial success has been widely noticed in the city itself.

    “Notably, we have used our relationship with DFS to supply a comprehensive portfolio of international wines & spirits and beauty brands for both departures and arrivals at Yangon International Airport and have introduced more than 30 international fashion and lifestyle brands to create an outstanding retail experience for this very modern, newly-built terminal.

    “This new terminal has dramatically increased the capacity of Yangon International Airport to meet the expected rapid rise in international travellers; for business, for tourism and for Myanmar nationals who are also starting to travel overseas in greater numbers. This new terminal is already scheduled for further expansion and this will undoubtedly create new opportunities for SMI in travel retail at the airport.”

    Bedingham also noted that a number of mall owners and developers in Myanmar saw SMI as a “highly desirable partner”. He continued: “We have been pleased to work with Junction City – a new integrated upscale development in downtown Yangon. We have been able to introduce several international brands that we work with at the airport into Junction City and nearly all of these retail stores have been opened by the end of April 2017.”

    SMI signed an exclusive distribution agreement with Shiseido Asia Pacific in February 2017 and the first Shiseido flagship counter in Myanmar will open in Junction City by mid-year 2017.

    Non-Executive Chairman Ho Kwok Wai said that SMI would now move focus on organic growth across its diversified business portfolio.

    He noted a World Bank report issued on 30 January 2017 which stated that Myanmar’s economy will grow an average of +7.1% per year in the next three years.

    “The landscape in Myanmar was very different when we began our transformation in 2013 but our objective for the group remains the same: to build a diversified business model to capitalise on the strong trends in consumer spending, international tourism and infrastructure investment in this frontier market,” he said.

    “From the encouraging results shown in our portfolio of businesses so far, there is positive sentiment that we are on the cusp of major advances in Myanmar, with strong growth potential.”

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  • Qatar National Bank injects Rp 2.18t into QNB Indonesia

    Qatar National Bank injects Rp 2.18t into QNB Indonesia

    The Qatar National Bank QPSC (QNB Group) as the controlling shareholder of Bank QNB Indonesia has injected Rp 2.18 trillion (US$162.72 million) into the bank as capital paid in advance as well as acting as standby buyer in the rights issue of Bank QNB Indonesia.

    The additional capital is the realization of QNB Group’s commitment to maintain the bank’s strong capital structure as well as maintain the bank’s business growth stability, the QNB Group said in a statement.

    From the total funds of Rp 2.18 trillion, Rp 2.06 trillion will be used to purchase HMETD offered during a rights issue and the remaining funds will be used for next year’s rights issue.

    Funds from the rights issue, after issuance costs, will be used by QNB Indonesia to increase productive assets, particularly in the form of loan disbursements.

    With the commencement of the rights issue and additional capital payments from QNB Group, the bank’s capital adequacy ratio (CAR) will be 16 percent, well above the Financial Service Authority’s (OJK) minimum requirement.

    On Monday, QNB Indonesia held an extraordinary shareholders meeting at the bank’s head office in Jakarta. The meeting approved Heba Ali Ghaith Al-Tamimi and Stephen Holden as commissioners and Adhiputra Tanoyo as director. The resignation of Grant Eric Lowen as a commissioner was also approved. (dea/bbn)

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  • WorldLink to build Nepal’s first 100G OTN

    WorldLink to build Nepal’s first 100G OTN

    Nepal’s WorldLink has engaged Nokia to deploy the nation’s first 100G optical network.

    WorldLink, Nepal’s largest fixed broadband operator, is upgrading its 650km backbone network with Nokia’s PSS DWDM technology.

    The backbone network spans from capital Kathmandu to the cities of Bhairahawa and Birgunj, and provides international connectivity between Nepal and countries including India.

    WorldLink has an estimated 120,000 residential broadband subscribers and 5,000 enterprise broadband circuits. The operator is currently connecting 10,000 residential FTTH subscribers per month, and is conducting the upgrade to help meet the fast-growing demand for network capacity.

    “WorldLink has a commitment to Nepal to transform the communications landscape so that our people and enterprises thrive,” the operator’s CTO Samit Jana said.

    “This is our largest project to date and it will allow us to provide ultra-fast broadband services for our mobile and fixed network subscribers in cities as well as rural areas across the country.”

    Nokia head of India Sanjay Malik added that the company is “proud to be part of WorldLink’s vision to transform Nepal’s communications architecture by providing the first 100G transport network. Nokia’s highly scalable optical platform will ensure low latency and high resiliency, and allow WorldLink to cost-effectively increase network capacity as needed.”

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  • Central Bank of Vietnam cuts rates by 0.25-0.5 per cent

    Central Bank of Vietnam cuts rates by 0.25-0.5 per cent

    The State Bank of Viet Nam (SBV) has cut several interest rates for the first time since 2014 in order to support business and boost economic growth.

    According to the central bank’s statement, 0.25 percentage points have been shaved off the annual refinancing interest rate, rediscount interest rate, overnight interest rate applied to electronic inter-bank payments, and the rate of loans to offset capital shortage in clearing payments between the SBV and domestic banks. The new rates go into effect today.

    Specifically, the refinancing rate has been reduced from 6.5 per cent per year to 6.25; the rediscount rate from 4.5 per cent per year to 4.25; and other rates from 7.5 per cent to 7.25 annually.

    The maximum annual short-term interest rate for loans in Viet Nam dong to meet customer demand for capital in some sectors has also been cut by 0.5 percentage points.

    Businesses operating in agricultural, export and auxiliary industries; small and medium-sized enterprises (SMEs); and high-tech firms will now enjoy a short-term lending rate of 6.5 per cent per year, instead of 7 per cent.

    The maximum rate applied to loans supplied by the People’s Credit Fund and other micro-financial institutions has been lowered from 8 to 7.5 per cent.

    These adjustments are expected to help increase bank liquidity for loans, stabilise interest rates, the foreign exchange rate and the foreign currency market, thereby contributing to controling inflation and achieving sustainable economic growth.

    Move welcomed

    Many experts welcomed this move, saying the adjustment is a good sign for the economy and enterprises, especially given that business and production is facing many difficulties, including shortage of capical and high interest costs.

    The rate cut will help reduce costs for commercial banks seeking loans from the central bank, boosting lending to enterprises at lower interest rates, they said.

    Tran Hoang Ngan, a member of the National Assembly’s Economic Committee, said this decision would consolidate the confidence of the market as it proves that the bank system’s liquidity has stabilised after the bad debts resolution.

    Tran Du Lich, a member of the National Monetary and Financial Policy Advisory Council, said the cut was modest, proving a cautious decision and not signaling monetary policy loosening.

    Financial expert Phan Minh Ngoc said that with lower interest, credit growth might be speeded up in the coming months, but because the SBV still keeps the ceiling credit growth target at 18 per cent, commercial banks approaching the cap must be choosier in selecting customers.

    “Thus, the adjustment basically is not an action to loosen monetary policy, but to help restructure the loans of commercial banks,” Ngoc said, adding that it was unlikely to raise inflation

    The central bank will be able to maintain the new interest rates as long as inflation is controlled at low level. But if the US Fed continues raising its interest rates, which would put pressure on the VND/US$ exchange rate, SBV might have to amend its policy, the expert predicted

    Following moves

    The Bank for Investment and Development of Viet Nam (BIDV) today also announced that the bank would apply a maximum annual interest rate of 6 per cent for short-term dong loans to prioritised enterprises in accordance with the SBV’s decision.

    Start-ups, environmental firms and the bank’s regular customers for at least three years will be able to enjoy the preferential rate, too. Firms and households affected by floods in the central provinces will be offered a maximum rate of 5.5 per cent, according to the bank’s press release.

    In another development, VPBank has become the first private commercial bank to reduce its short-term interest rates by 0.5-1 percentage points for SMEs. The preferential rates will depend on the production sector of the borrowers, the length of the credit relations they established, as well as their record of debt payment.

    Vo Tan Hoang Van, general director of the Sai Gon Commercial Bank (SCB), told Phap Luat Tp Ho Chi Minh (HCM City Law) that in the next two weeks, SCB would lower interest rates by 0.5 percentage points for new credit contracts serving production in prioritised sectors or being signed by SMEs.

    Some other banks also plan a cut in lending interest rates, but say the cut rates must be calculated based on liquidity conditions and taking account other measures to save costs and improve business performance, the newspaper reported.

    Nguyen Van Duc, deputy director of the Dat Lanh Real Estate Company, said that the cut of 0.5 percentage points was not so big but it would have a positive impact on the market and business profits, especially for large firms with heavy loans, he said.

    Ly Thanh Sinh, general director of the Minh Long Hung Garment and Embroidery Joint Stock Company, said that beside reducing interest rates, it was important for SMEs to access capital to buy machines and production equipment.

    Curently, annual short-term interest rates range from 6.8-9 per cent for regular businesses, and 6-7 per cent for prioritised ones; while medium and long-term rates hover around 9-11 per cent for the former and 9-10 per cent for the latter.

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  • Switch to Vegetarian Food on Air India Causes an Uproar

    Switch to Vegetarian Food on Air India Causes an Uproar

    Coming from some other debt-ridden airline, it might have been shrugged off as just another service cutback. But not this time: When Air India announced on Monday that coach passengers on its domestic flights would now be offered only vegetarian meals, the move provoked an uproar on social media.

    G. P. Rao, a spokesman for the government-owned airline, said the change was made a week ago strictly to reduce waste and cut costs. But what people eat can be a sectarian flash point in India, especially since Prime Minister Narendra Modi and his Hindu nationalist Bharatiya Janata Party took power.

    Many members of the Hindu majority are vegetarians, while the country’s Muslims and some other minorities eat meat. So the airline’s action was seen by many as discriminatory and part of a wave of religious nationalism sweeping the country.

    “Only veg food on Air India,” Madhu Menon, a Bangalore-based chef and food writer, wrote on Twitter. “Next, flight attendants to speak only Hindi. After that, stand for national anthem before flight take-off.

    The government of Uttar Pradesh, India’s most populous state, which is led by a new firebrand chief minister, has been cracking down on buffalo slaughterhouses this year, even though buffaloes are not considered sacred by Hindus the way cows are. And the lynching of a Muslim teenageron a train from Delhi last month, in which his assailants called him a “beefeater,” has further inflamed tensions.

    The government approved plans last month to privatize the airline, which has more than $8 billion in debt.

    Mr. Rao did not say on Monday how much the change in meals would save the company. But in an interview with The Hindu, a major newspaper, an official for the airline put the figure at 80 million rupees, or about $1.2 million, a year.

    Critics derided that as a drop in the bucket. Omar Abdullah, a former chief minister of the state of Jammu and Kashmir, wrote on Twitter that the move would “restore Air India to full health in … oh heck 5000 years.”

    The step on Monday was not the airline’s first away from serving meat. In January 2016, the airline replaced sandwiches with hot vegetarian meals for economy passengers on flights between an hour and 90 minutes long, The Press Trust of India reported, a change that the airline presented as an upgrade.

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  • Paper dominates Indonesia`s export in 2016-2017

    Paper dominates Indonesia`s export in 2016-2017

    Paper products dominate Indonesias global exports in two years, which was worth US$13.95 billion of the total wood products’ exports of $11.83 billion in 2016-2017.

    “These value are wood-based products with V-Legal documents, namely SVLK and FLEGT licenses,” Director of Forest Products Processing and Marketing, Ministry of Environment and Forestry, Rufiie, said here on Monday.

    SVLK is Indonesias timber legality assurance system, while FLEGT is the EUs Forest Law Enforcement, Government and Trade.

    According to Rufiie, the export of wood products using the V-Legal and FLEGT system was just implemented in 2016. FLEGT was issued after Indonesia implemented SVLK.

    In 2016, Rufiie added that the total global export value of Indonesia’s timber products amounted to $9.26 billion. Wood products’ exports with FLEGT license, which is exported to the EU, amounted to $868.85 million.

    Of the total exports, paper products to all countries around the globe amounted to $3.11 billion, while paper exports to the EU amounted to $204.17 million.

    “There are two systems applied in wood products’ export, namely with SVLK for all countries outside the EU and FLEGT Licenses for the EU market,” Rufiie remarked.

    Up to March 2017, the export value of wood products to all countries was worth $2.57 billion, while that to the EU was worth $277.26 million.

    The global paper export value until March 2017 was worth $837.37 million, while export to the EU was worth $65.25 million.

    “Export of wood products in the form of handicrafts to all countries till March 2017 was worth $28.91 million, export of furniture was worth $368.05 million, export of panel was worth $567.48 million, export of pulp was worth $475.66 million, export of wood works was worth $265.04 million, and export of wooden chips was worth $ 28.91 million,” Rufiie revealed.