VIETNAM BUSINESS NEWS UPDATE

Vietnam's Ministry of Information and Communications is aiming to migrate the country's government to open source software by the end of 2010. The ambitious plan calls for rapid adoption of open source software and extensive training to ensure that IT staff and government employees will be able to adjust to the change. The first stage of the plan, which entails migrating all of the backend server infrastructure and training the IT personnel that manage it, is scheduled for completion by the end of June 2009. The next stage is the desktop rollout, which mandates adoption of OpenOffice.org, Firefox, and Thunderbird. The government expects this transition to be completely by the end of 2010.

The domestic garments and textiles sector has targeted to earn US$9.2-9.5 billion from exports in 2009, up 5% against 2008. In order to achieve the target, the sector has worked out measures including strengthening the apparatus of the Vietnam garments and textiles group, increasing productivity, developing human resources, boosting investment in to selected projects of effectiveness, accelerating trade promotion activities and expanding export markets in the Middle East, Eastern Europe and Africa. 2009 has been forecast to be a year of continued great difficulties for the sector due to the global economic recession and competition pressure from Chinese products. In 2008, the garments and textiles sector grew by 18% and earned US$9.1 billion from exports.

Vietnamese dairy farmers have filed a civil suit seeking compensation from the health ministry for erroneously saying the company they supplied sold melamine-laced products. Nearly 100 farmers in the northern province of Vinh Phuc said they were unable to sell their milk for three months after the health ministry announced that Hanoi Milk Joint Stock Co.'s products were tainted by the industrial chemical, the Vietnam News reported on Wednesday. The ministry recently said the company's products were in fact melamine-free, but the farmers said their situation had not improved. Hanoi Milk, Vietnam's third largest dairy product company, has reported that its revenue fell 70% in September due to the melamine scare.

Vietnam’s optimistic economic outlook ranks 7th amongst 36 countries and territories, said Grant Thornton International Ltd on January 5. The Grant Thornton International Business Report shows optimism in Vietnam to have fallen from +87 to +31, but as major world economies enter into recession, Vietnam remains one of the most optimistic countries in the world. Their macro view of the world economic stage explains the overall slump in optimism, but while privately held businesses are preparing for a prolonged and painful downturn, those in the emerging economies realize that at their own micro level it could offer real opportunities," said Kenneth Atkinson, Managing Partner of Grant Thornton Vietnam

Vietnam's central bank set the dollar's exchange rate lower at VND16,970 Thursday. The state-owned Vietcombank sold lower at VND17,479, compared with VND17,481 Wednesday. Gold shops sold flat at VND17,540. Dealers said they expect the exchange rate to rise toward the weekend on rising demand for the dollar.

A Hanoi court is believed to sentence two Malaysians - Tan Wei Hong, 26, and Cham Tack Choi, 23, to seven years in prison on Wednesday on charges of using fake credit cards. The two Malaysians were arrested on Dec. 21, 2007 when they went on a shopping spree at the Louis Vuitton fashion shop in Hoan Kiem district Hong later admitted to the police that he had visited Vietnam on three occasions and used fake credit cards to pay for 293 million VND (US$17,000) worth of goods. Meanwhile Choi had made two visits to Vietnam for the same purpose and had used fake cards to rack up more than 275 million VND (US$16,200) in goods.

The Advertising Research and Training Institute of Vietnam (ARTI Vietnam) and the Institute for Advertising of Singapore (IAS) will cooperate in training personnel for Vietnam’s fledging advertising sector. The two sides will ink a cooperation deal in Ho Chi Minh City on Jan. 9. On the occasion, ARTI Vietnam, which was officially set up in Sept. 2008, will grant certificates for its first graduates.

The Ministry of Planning and Investment (MoPI) has submitted to the Prime Minister for approval a 1 billion USD project to build a golf course, five-star hotels and hostels in Vientiane, Laos. If approved, it will be Vietnam’s ever largest investment project abroad. The project’s investor, Long Thanh Golf Investment and Business Joint Stock Company, said it plans to mobilize capital from share holders, domestic and foreign partners and bank loans. According to the MoPI, Vietnam is the largest foreign investor in Laos with 146 projects worth 1.5 billion USD. In the first 11 months of 2008, Vietnamese businesses invested in 52 projects in Laos with total registered capital of 450 million USD.

Kinh Bac City Development said it may buy Saigon Telecommunication & Technology Corp. to improve telecommunications services within its industrial zones. Kinh Bac, a real estate and industrial zone developer in Bac Ninh province, is considering acquiring or merging with SaigonTel this year, Chief Accountant Tran Ngoc Diep said.

The acquisition plan requires shareholder approval, he said. Kinh Bac already owns about 19% of SaigonTel, according to Diep. The phone company rose 3% to close at VND27,300 on the Ho Chi Minh Stock Exchange Tuesday. The stock lost 67% of its value last year, giving it a market value of VND1.6 trillion (US$91 million).