Newsletter
N.4/2014 October 2014
Official opening of the Italian Consulate General in HCMC (p.3) Opening
Fiera del Levante Bari (p.4) Meeting with President of EU
Jose Manuel Barroso (p.2)
Webinar: Vietnam Destination – A world of opportunity (p.6)
ICHAM
Extraordinary General Meeting
(p.8)
Vietnam -
Biggest Coffee Producer? (p.10)
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NEWS MEETING WITH PRESIDENT OF EUROPEAN COMMISSION JOSE MANUEL BARROSO
The European Chamber of Commerce (Eurocham) organized a meeting between the European business community in Vietnam and President of European Commission Jose Manuel Barroso on occasion of his second visit to Vietnam. This was a special event dedicated to members of European Chamber of Commerce in Vietnam including ICHAM represented by the President, together with representatives of diplomatic delegations, among which was the presence of Italian Consule General represented by the new Consulate General Mrs. Carlotta Colli. During his speech, President Barroso updated the audience with the negotiation status for the signing of Free Trade Agreement (FTA) which may be concluded within a few months. The visit of President Barroso has underlined once again the importance of of diplomatic relations between Vietnam and EU, its second largest trading partner with trade exchange turnover at 24.2 billion euro and one of the biggest investors with 1.800 FDI projects.
CELEBRATION OF VIETNAM’S INDEPENDENCE DAY AT HCM’S PEOPLE’S COMMITTTEE. The People’s Committee of Ho Chi Minh City organized a meeting to celebrate the 69th anniversary of the proclamation of the Sociolist Republic of Vietnam (2/9/1945-2/9/2014). The celebration was held at the city’s Municipal Palace with the presence of Mr. Le Hoang Quan, Chairman of HCMC People’s Committee and other institutional representatives. At the meeting there were also the representatives of diplomatic delegations and foreign business communities in Vietnam, including Italian delegation with the participation of Italian Consule General Mrs. Carlotta Colli, ICHAM President Michele D’Ercole and ICE Director Bruna Santarelli. During his speech, the Chairman demonstrated how Ho Chi Minh City has continued its positive trend of economic growth over the past few years thanks to favorable business conditions. He also hoped that investments from foreign business communities could continue to grow positively to obtain good results for both parties. The event was a good occasion for networking and strengthening relations with the representatives of Vietnam’s institutions.
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NEWS OFFICIAL
OPENING
OF
THE
ITALIAN
CONSULATE GENERAL IN HCMC
Vietnamese citizens and support services to 400 Italians who live and work in Ho Chi Minh City and 22 adjacent provinces.
She also put an emphasis on a concrete collaboration with professors and students at the University of Humanities and Social Sciences and the Conservatory of Ho Chi Minh City to spread more and more knowledge of the Italian language and culture.
The Italian Consulate General in Ho Chi Minh was officially inaugurated on September 10th by the Italian Ambassador to Vietnam H.E Lorenzo Angeloni and the Consul General Mrs. Carlotta Colli in the presence of the General Director of Ho Chi Minh City’s Department of External Relations Mr. Hong Linh. During his speech, the Ambassador stressed that the opening of the consulate, in a time of economic difficulty for Italy, has shown a great economic interest of Italy to Vietnam and then the synergy that the Consulate will be working closely with the Chamber of Commerce and ICE, both present at the opening ceremony. The Consul General Carlotta Colli illustrated the most important services that the Consulate General will offer including the issuance of visas for
―CABINA DI REGIA‖ - MEETING BETWEEN ITALIAN AMBASSADOR, CONSOLE GENERALE, ICHAM, ICE, INTESA SANPAOLO HCMC “Cabina di Regia” is a periodic meeting between the Ambassador, the Consul General, ICHAM President, ICE Director and Representative of Intesa Sanpaolo in Vietnam. During the meeting, coordinated by the Ambassador Angeloni, each of the participants explained how the economic situation in Vietnam is experiencing a positive trend, with GDP growth estimated at 5.5%, on the forthcoming signing of Free Trade Agreement between Europe and Vietnam. The meeting also discussed in details the upcoming National Mission in Vietnam which will take place from 24 to 28 November. ICE Director updated the
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NEWS attendees with the program of activities planned during the mission, even if we are still waiting for final confirmation. The Ambassador informed that probably during the same period, the Embassy will host the Economic Commission between Vietnam and Italy and it will need the cooperation of all the attendees. OPENING FIERA DEL LEVANTE - BARI Prime Minister Matteo Renzi delivered a speech in the opening ceremony of Fiera del Levante, one of the most important fairs in Italy and the Mediterranean, held in Bari. At the ceremony, there was also the presence of the Mayor of Bari, the President of Puglia Region and Bari Province, and the Minister of Defense Roberta Pinotti.
ICHAM President Michele D’Ercole also participated in the event together with Commercial Counsellor of Vietnamese Embassy in Italy Vuong Anh Bui. This was also an important meeting for other enterprises attending the event to present to the opportunities offered by the Vietnamese market to Italian enterprises. Furthermore, a Desk Vietnam was opened by ICHAM and the Chamber of Commerce Italy-Vietnam in Torino from 18 to 19 September at Fiera del Levante.
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NEWS ASSOCAMERESTERO GENERAL ASSEMBLYROMA
―FOCUS VIETNAM‖ - GIORNATE DI INCONTRI INDIVIDUALI PER LE AZIENDE, VENEZIA - MARGHERA
With the aim of deepening the opportunities offered by the Vietnamese market, Veneto Promotion has organized two days of individual meetings aimed at companies in the Veneto.
As Area Representative, ICHAM President Michele D’Ercole participated in the General Assembly of Assocamerestero, which was held in Roma, at the headquarters of UNIONCAMERE. The Assembly, chaired by Assocamerestero President Leonardo Simonelli, discussed and analyed various topics. One of the most significant speeches was that of UNIONCAMERE President Ferruccio Dardanello, who pointed out that, as a result of the government’s enabled act, the Chamber System is at risk of a sharp decline in the number of activities of internationalization. Other important speeches came from the representatives of MAE (Ministry of Foreign Affairs) and MISE (Ministry of Economic Development) aiming to push for a more and more fruitful cooperation between different organizations of internationalization, such as National Chambers of Commerce, Italian Chambers of Commerce Abroad (CCIE), Confindustria and ICE. The following discussion between the Board Members was very transparent and inspiring to find practical solutions to develop future business opportunities that the CCIE will seize to continue their useful service for the promotion of foreign markets particularly for SMEs (small and medium enterprises).
On Monday 13 and Tuesday 14 October at the headquarters of Toscana Promozione (VeniceMarghera-Via delle Industrie 19/d) Dr. Hoang Hai PHAM, Secretary-General of the Italian Chamber of Commerce in Viet Nam, will be available to meet, according to an agenda of appointments default, Venetian companies concerned about the opportunities offered by the Vietnamese market in relation to its activities. Such meetings may also be a viable opportunity for Venetian companies to assess the possibility of participation in the "Venetian economic mission in Viet Nam", an initiative included in the promotional Program Regione del Veneto, which will be held in the first quarter 2015 and will follow a short special communication.
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NEWS WEBINAR: VIETNAM - A WORLD OF OPPORTUNITY Icham, in collaboration with Unioncamere Emilia-Romagna held a webinar on October 14 to promote the Italian business mission in Vietnam from 23 to 26 November. The workshop is aimed to discuss the opportunities and challenges for Italian companies who wish to expand their business in Asia, with a specific focus on the fields: mechanical/ mechanical engineering (related to the sector plastic/rubber, textile, footwear, clothing, wood, food, stone, ceramics), energy and renewable energy, medical and biomedical, andconnectivty and infrastructure (roads, ports, airports, railways, tourism ect ...). Video-conferencing from Vietnam were the guest speakers - Mai Huu Tin, President of Vietnam’s National Association of Young Entrepreneurs; Christoph Schill, Vice President of Green Growth Sector Committee; Pham Hung Van, Representative of Bioteck Co.; and Vo Son Dien, Marketing Manager of Becamex Binh Duong. “Vietnam is considered as a potential market which is a gateway to ASEAN” Mai Huu Tin
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NEWS SAIE - FIERA DI BOLOGNA ―BUILD ENVIROMENT 2014‖
A presentation of the market and opportunities in Vietnam was held on 22 October. Right after the exhibition, Vietnamese entrepreneurs have not only received invitations to visit establishment by Italian companies but also European ones such as the Czech Republic companies.
PARMA, CIBUSTEC A NEW PROJECT FOR THE FOOD INDUSTRY
A central event for the Italian construction industry for the last 50 years, SAIE 2014 has now become the platform for the Built Environment which takes Italian know-how to the world.
Following SAIE, another delegation of Vietnamese enterprises led by Icham participated in Cibus Tec, a project for the promotion of technologies and solutions for the Food and Beverage Industry.
A large number of delegations have been invited to meet with companies exhibiting at SAIE, from Azerbaijan, Brazil, Iran, Turkey, the Mediterranean Basin, Qatar, the Arab Emirates, Saudi Arabia, Zambia and Vietnam.
Cibus Tec serving the Food Industry for 70 years is enriched by Food Pack, a new exhibition section dedicated to the best technologies for packaging of food products. Production efficiency, food safety and sustainability of the process chain are the main topics of the exhibition.
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NEWS ICHAM — EXTRAORDINARY GENERAL MEETING On Tuesday, October 28th 2014 The Extraordinary general assembly chaired by ICHAM President Michele D’Ercole, together with the attendance of ICHAM’s members in order to elect three new councillors for ICHAM Board of Directors. Before starting the presentation, the president dedicated a few minutes to remember Mr. Paolo Fornari, ICHAM vice president, who had passed away on 21st October after a long struggle with illness and had so many contributions not only for the Italian Chamber of Commerce but also for the Italian business community in Vietnam. The updated Board of Directors includes: 1. 2. 3. 4. 5. 6. 7.
President of ICHAM summarized some activitites and missions undertaken: AGM, Lineapelle Seminars, Netplus, MECSPE, Cosmprof, SAIE, etc. Furthermore, Icham signed cooperation agreements with Unioncamere Emilia-Romagna, Centro Estero Piemonte, and EVBN (EU-Vietnam Business Network). And then The assembly started voting. Each voter will select maximum 3 candidates. The voting results were checked and supervised by Mrs. Carlotta Colli in HCMC, and by Mrs. Natalia Sanginiti in Hanoi. According to election results, Francesco Dominici, Mauro Spizzo and Antonio Citati were elected. Right after the general assembly, the president Michele D’Ercole called for a quick meeting of the Board of Directors for a division of roles between the Board members, in particular to elect the new vice president and treasurer.
President: Michele D’Ercol Vice President: Luca DallaVecchia Treasurer: Antonio Citati Councillor: Van Tinh Tran Le Councillor: Enrico Rossi Councillor: Francesco Dominici Councillor: Mauro Spizzo
The new directors just elected with knowledge and ex periences will contribute to strengthen ICHAM activi ties and raise opinions to the government, focus on commercial aspect, create more networks, increase Ita ian presence in Vietnam.
Three new councillors (from left to right): Mauro Spizzo Antonio Citati, Francesco Dominici.
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infoMERCATO
FOREIGN COMPANIES REPORT LABOR AND SKILL SHORTAGE IN VIETNAM
FOREIGN INVESTED FIRMS DOMINATE VIETNAM’S GARMENT AND TEXILE INDUSTRY
Despite strong growth in demand for workers in Vietnam, supply and skills have not kept up with this increasing need. Many foreign companies have not found it easy to recruit mid-level and senior staff and are forced to spend a sizable amount of money every year on employee training programs. According to the Hanoi Institute for Socioeconomic development studies, unskilled laborers account for 41.4 percent of the labor force in Hanoi and 54.5 percent in HCMC. Many Vietnamese laborers tend to lack necessary skills such as language, cognitive, and technical skills. Nonetheless, many foreign firms say that local laborers are capable of becoming very efficient workers once they have completed training courses. Vietnam is adding more than one million laborers to its workforce every year, it has a growing consumer class, and it is becoming a key manufacturing location – all of these factors point to the country quickly overcoming these HR problems and becoming highly competitive in the region. (Source: Dezan Shira & Associates)
According to the Vietnam Textile and Apparel Association, there are 3,000 garment and textile firms in Vietnam – 25 percent of which are foreign directed invested firms. Despite their small overall number, FDI firms account for 60 percent of Vietnam’s total garment and textile export revenue. Foreign firms are expected to continue ramping up their investments throughout the year in anticipation of forthcoming Free trade agreements (FTA) and Trans-Pacific Partnership Agreement (TPP). If the trade negotiations are successful, Vietnam would be able to either halve or nullify a 17 percent duty the U.S. currently levies on Vietnam garment exports. In expectation of this result, foreign firms are implementing major investment projects in the textile and garment sector throughout the country. For example, Worldon Vietnam Co. Ltd. invested a US$140 million facility producing high-end garments project in HCMC. (Source: Dezan Shira & Associates)
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NEWS VIETNAM THE LARGEST COFFEE PRODUCER?
DOUBLE TAX AGREEMENT FOR ON-SPOT EXPORT - IMPORT ACTIVITIES One June 12th 2014, General Department of Taxation (GDT) issued Official Letter of the guiding application of Double Tax Agreement (DTAs) between Vietnam and other countries/territories for on-spot export-import activities.
In recent years, coffee has become one of Vietnam’s key agricultural export products – with 95 percent of output being shipped abroad. Per year, on average, coffee exports from Vietnam bring in around US$3 billion in revenue to the country. Currently, the country is the world’s second largest coffee exporter, behind only Brazil. However, many experts believe that Vietnam has the potential to overtake Brazil thanks to its favorable climate conditions, lower cost production and a bumper coffee crop. The main challenge that Vietnam must overcome is the need to improve its product quality by investing more in research, harvest technology and processing facilities. As the country becomes more dominant in the coffee industry, international coffee companies are helping to further build up the expertise of local Vietnamese suppliers. For example, Mondelez International invested in a project to help Vietnamese coffee farming entrepreneurs strengthen their agricultural and business skills. (Source: Dezan Shira & Associates)
Accordingly, foreign enterprises which have been carrying out production, trading activities in Vietnam through a permanent establishment (PE) (a processing enterprise or a trading enterprise) would have to pay Corporate Income Tax (CIT) obligations under the on-spot export-import form on the profit allocated to such Vietnamese PE under the provisions of Point 1, Article 7 of DTAs. Following the above GDT’s instructions, Dong Nai Tax Department also provided guidance that the companies should determine by themselves whether they are entitled to tax exemption, reduction under the provisions of the DTAs and the guidance of the Official Letter No. 1939/TCT-HTQT.
* Since August 2nd, new points of Circular No.78/2014/TT-BTC on Corporate Income Tax (CIT) have taken effect and are applicable to 2014 CIT tax period onwards. More details should be referred from Official Letter No. 2785/TCT-CS dated July 23rd 2014. (Source: Grant Thornton)
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Members & Friends
A big salute to Paolo Fornari – ICHAM Vice Presidente Paolo Fornari, our vice president and dear friend, passed away on 21st October after a serious illness Paolo made a lot of contributions not only to the Italian Chamber of Commerce but also to the Italian business community in Vietnam. With great sorrow in our heart, we would like to remember him always with the smile, commitment and enthusiasm that he put in all the activities he undertook, whether it is social or working activity. “A big hug for you, dear Paolo� Deepest condolences to his family.
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Members & Friends INTERVIEW WITH GABRIELE UGOLINI: INTERNATIONAL MARKET MANAGER – COMMERCIAL DIRECTOR OF BANK GROUP BANCA POPOLARE EMILIA-ROMAGNA (ITALY) This interview is conducted with the precious collaboration of Mr. Massimiliano Bertollo. Conducted by Van Tinh – TRAN LE, ICham Councillor. Emails: councillor@icham.org; van.tinh.tran.le@gmail.com
1. Mr. Ugolini, could you introduce about Banca Popolare Emilia-Romagna (www.gruppobper.it)? It is known as one of Italy’s largest banks, can you confirm? Certainly. We are the national sixth largest banking group. The success of the recent increase in charter capital up to 750 million euros is a testimony. 2. As a banking group, what is your mission and do you plan to open a branch in Vietnam in the near future? Is your bank already present in other territories?
Our philosophy is to assist the enterprise, entrepreneur right from the first stage of internationalization. It is usually thought that the Bank is involved only in the mature phase of an operation: to guarantee services related to payment or financing an initiative. These are obviously important aspects that we guarantee maximum support. However, as I said earlier, we want to reverse this process and intervene at an early stage and help our clients to make decisions based on awareness of the situation. To internationalize requires knowledge and to have knowledge requires investing, not only money but also resources. It is in this specific phase that SMEs often need a help, a support, and we want to be present in this stage. Our new portal for internationalization designed in line with this philosophy will soon to be launched. That’s why we strongly believe that a potential customer should believe in our Group as a real and concrete partner for internationalization. Regarding to the question about the company in Mazara del Vallo, I would like to emphasize that our Banking Group is present in Sicily through local branches, but thanks to the portal that I have mentioned, the company cannot only discover our offers on internationalization but also contact us to ask for a special meeting about the topic with our closest geographically specialist.
We are a universal banking group closely tied to the territories where we operate at 360 degrees: families and businesses. For the businesses, we have guaranteed a support even during periods of great financial crisis after 2008. We haven’t had any establishments in Vietnam yet, only a representative in Hongkong, still we have a specific focus for the whole area. We are looking here (in Vietnam), as well as in other countries, for cooperation opportunities with social and private organizations that can give the best support to our enterprises and investors, because our objective is not only financial support but also the assistance 4. The Cypriot, Irish, Spanish, Greek and Portugese and consultancy at many levels. banking systems have encountered many difficulties. In your opinion, how much solid is the Italian banking 3. How does your Group support small and me- system? dium enterprises in internationalization process? Why should a potential customer choose Bper I think it is very solid, much more solid than the conGroup? Can an enterprise from Maza del Vallo clusions drawn by international analysts and rating (Southern Sicily) asks for your support? firms.
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NEWS 5. The European Central Bank has injected hundreds of billions of liquidity to the above-mentioned banks: it has now become a common opinion among citizens that when it comes to make money, the bank is a first choice; when things go wrong, the community pay back to the bank. So what do you think, not as a bank officer but as a citizen? Knowing all the details from the inside, I have to be a citizen but bank officer; therefore I completely refuse this commonplace. Anyway, it would be very long and difficult to try to scratch a dominant thought that the media like. 6. How about your opinion as a bank representative? I think I have just answered the question. 7. Between April and July there will be at least 10 bank recapitalizations, with a request for at least 8 billion for each shareholder. After the operation of 1,5 billion of Banca Popolare, starting from 31st March to 17 April, in the following weeks, there will be recapitalizations of: Popolare di Milano (500 million), Credito Valtellinese (400 million), Monte dei Paschi (3 billion, starting from 19 or 26 May), Banca Carige (800 million), Popolare di Sondrio (350 million). This emission is joined by some unlisted banks (usually silmultaneously): Popolare di Vicenza (1 billion), Veneto Banca (500 million), Popolare di Bari ( 125 million) and Banca delle Marche (about 500 million). Are you taking the same path (capital increases)? It can be seen from my first answer about the 750 million increase literally “burned” for 100% by the shareholders in a few days. 8. Why is it harder for a SME to approach the capital than a large enterprise? Is it because of their lack of knowledge of the political shift?
I will not respond to this question, which I find inappropriate. 9. Is interest rate the same from Trento to Trapani? It can depend on many factors, not excluding the competitive situation of one region compared to the others. I would avoid a biased answer with the commonly seen motif extreme North – extreme South. 10. My grandfather is going to retire after a long time dedicated to work. In your opinion, what should he do with his small savings? Should he continue to hide them under bed? Take them to one of the thousand branches of Banco Popolare Emilia-Romagna in Italy, they will be safe, a lot safer than being hidden under bed, and of course, this also ensures a proper remuneration. 11. If Italy had a leader like Mrs. Merkel, what do you think would happen to the bureaucratic state machine? In other words, do you think Italy needs a Merkel? Italy surely needs reforms to break the bureaucracy, a bad and expensive one. Anyone who can do this will bring benefits to the nation; but I believe we do not need to “import” ideas, especially “people”. With commitment and good will of everybody, we are surely able to do it ourselves. 12. Recently there has been an online “referendum” in Veneto on independence and then secession from Italy, which is not within the objective context. Why do these feelings and thoughts (secession) do not exist in Emilia-Romagna, a region wealthier than Veneto? Personally, I think this issue is quite strange. I still prefer to stay on technical topics related to my business.
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NEWS Let’s turn to the ―complicated‖ part of the interview. 13. In Milan, the Chinese surname “Zhou” surpassed “Brambilla” in 2013. The Milanese surname “Fumagalli” also lost its position compared to 2012, falling from 30th to 36th place ... This is a decline in several fronts, beside the economical and financial fronts! Could you share more about this fact? http://www.ilsole24ore.com/art/notizie/2013-08-25/ zhou-sorpassano-brambilla-cosi-144710.shtml? uuid=AbnjYFQI I will take note of this evolution. 14. “Time is money, we should not waste it in hesitation” said by Thomas Mann. Without hesitation, could you tell me how much is it important of a working life without having a surname that matters? Do you have such an important name?
Quote of the month: “The depreciation of local currencies is like a drug: they stimulate in short term but destroy in the long term.” Carlo Cottarelli, former Director of IMF’s Fiscal Affairs Department.
Van Tinh – TRAN LE Councillor – Italian Chamber of Commerce in Vietnam Emails: councillor@icham.org van.tinh.tran.le@gmail.com www.icham.org This interview was translated from the original in Italian
I myself have worked for the bank for 40 years. I started as an ordinary employee and no one ever hindered that progress; and I did not see any favoritism related to important names: the current leaders of our Group is an evidence. 15. Some of your colleagues working in private organizations confirmed with me that they prefer the tax paradise to the paradise mentioned in Holy Bible. If you allow me, may I ask which paradise do you prefer? I think this topic has nothing to do with me and it has never occured to me. Thank you for your time.
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Upcoming Upcoming Activities Event
3 December
ICHAM Christmas Party
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