Vietnam pushes renewable energy with focus on solar power

Vietnam is grappling to generate enough energy to power the economy.

Vietnam’s electricity consumption has grown twice as fast as the country’s economic growth rate.

The average energy consumption inVietnam grew 13 percent from 2006-2010, and by about 11 percent from 2011-2015, said Le Tuan Phong, deputy head of the General Directorate of Energy. The country is on the path towards powering itself by 2030, Phong said.

The country’s power production is expected to grow at an annual rate of 14 percent between 2015 and 2030.

Fossil fuels still dominate Vietnamese energy consumption. According to the World Bank, over 66.2 percent of the country’s energy comes from fossil fuels.

Vietnam’s annual coal output is currently about 40 million tons, official statistics show.

Coal has taken over from hydro power as the leading source of electricity in Vietnam, which has recently become a net coal importer.

In response to fast growing demand for power, Vietnam is building more coal-fired thermal plants and buying electricity from neighboring China as part of measures to avoid outages.

Vietnam, however, is faced with a two-fold energy challenge. The country has to generate enough energy for economic growth and for millions of people who still lack access to energy services, while gradually shifting towards clean, low-carbon energy, said Tran Dinh Thien, head of the Vietnam Economic Institute.

“Vietnam’s economic growth still relies heavily on the exploitation of natural resources and relatively low-tech production. Industries such as cement and steel use a colossal amount of energy,” said Thien, adding that only 2 percent of local businesses are high-tech driven.

The Vietnamese government should change the country's economic structure and prioritize energy-saving industries, Thien suggested.

Half of Vietnamese households use solar energy

Along with the need to decrease the reliance on fossil fuels, the country needs to build an energy sector more focused on renewable energy, particularly solar energy.

To put Vietnam on a path to a clean energy economy, the government plans to cut coal consumption by 30 percent by 2030.

The government has also opened up its renewable energy sector to foreign investors, allowing them to invest in power generation. Official statistics show that in 2013, foreign investments in energy through the Build – Operate – Transfer model accounted for 6 percent of total installed capacity.

The country is also restructuring its power sector by breaking up its retail power monopoly EVN to develop a competitive retail power market by 2030.

Vietnam is aiming to generate enough energy to power almost every home by 2020 and increase residential solarpower usage to 50 percent of households nationwide by 2050.

Source: Bao Vnexpress

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Vietnam's revised energy plan might not be as green as it seems

Last March, Vietnam upped its planned share of renewable energy for 2030 to 10 percent, from the initial 4.5 percent. However, in the next 15 years, Vietnam also plans to increase its reliance on coal fired power, the most carbon intensive electricity source.

*Vietnam relies mostly on hydropower to produce electricity. Therefore, renewable energy in this article refers only to solar power, wind power and biomass energy.

As part of the Power Development Master Plan VII released in July 2011, the country will give priority to developing renewable energy sources. The rate of renewable power is planned to account for 4.5 percent by 2020 and six percent in 2030. However, the revised Power Development Master Plan VII released in March 2016 has adjusted those rates up.

Wind power, solar energy and biomass power contribute insignificantly to total electricity produced.

On the other hand, by 2030, the government plans to rely on coal-based plants to produce electricity, making coal fired power the dominant power source. The rate of renewable energy will only account for 10.7 percent of the country's power supplies.

Details in the Power Development Master Plan VII show that as of 2030, there will be 83 coal-based plants, but only 10 renewable plants. According to the Guardian, World Bank President Jim Yong Kim has warned that plans to build more coal-fired power plants in Asia would be a “disaster for the planet”. “If Vietnam goes forward with 40GW of coal, if the entire region implements the coal-based plans right now, I think we are finished,” he added.

 Source: Bao Vnexpress

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Vietnam sees record new business in 2016

A man welds a steel bed at a furniture factory outside Hanoi. Photo by Reuters/Kham

The new 110,000 businesses could create nearly 1.3 million jobs.

Vietnam saw a record number of business openings in 2016, shedding hopes for robust growth and strong investment in the near future.

A new report from the Ministry of Investment and Planning said the past year saw 110,000 new businesses open, up 16.2 percent from 2015. Registered capital increased 48 percent to more than VND891 trillion ($39 billion).

These new companies are expected to create nearly 1.3 million jobs, independent of the nearly 26,700 firms who suspended operations during tough times only to resume operations in the past 12 months.

Vice Minister Dang Duy Dong described the numbers as “lively.”

“With such energy and investmentopportunities, the market will surely be more competitive and the economy will leap strongly,” the government report quoted Dong as saying.

More than 36,000 new businessescame online in Ho Chi Minh City and nearly 23,000 in Hanoi.

New openings in the real estate sector increased almost 84 percent from last year, while education and healthcare openings increased 43 and 52 percent, respectively.

Arts, entertainment and agriculture businesses all dropped from last year.

But the ministry’s report also revealed a dark side of the boom.

Bankruptcies surged 32 percent to nearly 12,578, including in both agriculture and real estate.

Vietnam hopes to see over one million businesses in operation by 2020, which means an average of 100,000 openings every year.

Source: Bao Vnexpress

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Forms of Public Private Partnership Investment in Vietnam

Public investment in Vietnam is not just limited to the transportation infrastructure, electricity, renewable energy, water, health and environment, but also in areas such as education, training, vocational training, culture, sports, commercial infrastructure complex, science and technology, economic zones, industrial zones…

Vietnam is in the development stage that needs significant investment in infrastructure.  However, the state budget is limited, and donor funds have been reduced and limited. Therefore, the investment pattern in the form of public-private partnership (also known as PPP) is an effective solution to this problem. PPP has been expected to mobilize resources for investment in infrastructure from the private sector, from both domestic and foreign investment.

Investments in the form of public-private partnership investment is made on the basis of contracts between competent state agencies and investors or project company for the implementation, management and operation of the project in infrastructure, or providing public services. Accordingly, investors, project company shall be authorized to implement investment projects on construction or renovation, upgrading, expansion, management and operation of infrastructure projects or providing public services.

The investment contracts in the form of public-private partnership are defined in Vietnam as following.

BOT Contract

“Build – Operate – Transfer contract” (referred to as BOT contract) means a type of contract to build an infrastructure project between a competent state agency and an investor; after completing the construction, the investor shall be entitled to operate it for a specified period of time; eventually, the investor shall transfer it to the Vietnam competent state agency.

BTO Contract

“Build – Transfer – Operate contract” (referred to as BTO contract) means a type of contract to build an infrastructure project between a competent state agency and an investor; after completing the construction, the investor shall transfer it to the competent agency, and shall be entitled to operate it for an agreed period of time.

BT Contract

“Build – Transfer contract” (referred to as BT contract) means a type of contract to build an infrastructure project between a regulatory agency and an investor; after completing the construction, the investor shall transfer it to the competent agency, and then the investor will be allotted a land parcel used for carrying out another project.

BOO Contract

“Build – Own – Operate contract” (referred to as BOO contract) is a type of contract to build an infrastructure project between a competent agency and an investor; after completing the construction, the investor shall take ownership of this project and have the right to operate it for a specified period of time.

BTL Contract

The Build – Transfer – Lease contract (referred to as BTL contract) means a type of contract to build an infrastructure project between a competent agency and an investor; after completing the construction, the investor shall transfer it to the regulatory agency and shall be entitled to provide services on the basis of operation of such project for a specified period of time; the competent agency shall lease and make payment for the investor’s services.

BLT Contract

“Build – Lease – Transfer contract” (referred to as BLT contract) means a type of contract to build an infrastructure project between a competent agency and an investor; after completing the construction, the investor shall have the right to provide services on the basis of operation of such projector a specified period of time; the competent agency shall lease and make payment for the investor’s services according to the regulation; when the lease term expires, such project shall be transferred to the competent agency.

O&M Contract

“Operation & Management contract” (hereinafter referred to as O&M contract) means a type of contract to operate the project between a competent agency and an investor for a specified period of time.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn

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Hanoi, Ho Chi Minh City listed as foreign investment magnets

Vietnam received an estimated $18.1 billion in new FDI pledges from January to November this year.

Ho Chi Minh City and Hanoi have been ranked 10th and 17th respectively out of the top 25 emerging market cities on the fDi 2016/17 Global Cities of the Future listing, a global investment service provided by the Financial Times.

Ho Chi Minh City, Hanoi listed as foreign investment magnets

Chinese cities dominated the ranking with Shanghai and Beijing claiming the top two places.

Thailand’s Bangkok was the other Southeast Asian city named on the list, placed above Ho Chi Minh City and Hanoi in 9th.

In the top 25 overall ranking, which included emerging and developed countries, Singapore kept its position at the top of the table as the Global City of the Future 2016/17, with London holding strong in second place and Dublin displacing Hong Kong to rank third.

 The ASEAN Investment Report 2016 showed that Cambodia, Laos, Myanmar and Vietnam (CLMV) recorded a combined 38 percent jump in FDI inflows to $17.4 billion last year from the year before. Their share as recipients of the investment flowing into the region rose from 10 percent in 2014 to 14 percent in 2015.

Leading the CLMV group, Vietnamattracted FDI inflows of $11.8 billion in 2015, a 28 percent increase year-on-year, said the report.

Vietnam received an estimated $18.1 billion in new FDI pledges from January to November this year, down 10.5 percent from a year ago, according to the Ministry of Planning and Investment.

However, the investment ministry said foreign investors had disbursed an estimated $14.3 billion in Vietnam as of the end of November, a rise of 8.3 percent from the same period last year.

Foreign direct investment inflows to Vietnam are expected to hit a record high of $15 billion this year, Prime Minister Nguyen Xuan Phuc said at the Vietnam Development Forum earlier this month.

Source: Bao Vnexpress

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FDI Status in 11 Months of 2016

Vietnam has become an ideal destination for foreign investors from many countries to come and invest in Vietnam. Generally in the first 11 months of 2016, total newly registered and additional capital reach 18.103 billion USD, equivalent to 89.5% compared with the same period in 2015.

Operational status:

Implemented capital:

As of November 20^th 2016, it is estimated that the foreign direct investment (FDI) projects have disbursed 14.3 billion USD, increased by 8.3% over the same period in 2015.

Exports and imports:

Exports of the foreign investment sector (including crude oil) in the first 11 months of 2016 reached 114.076 billion USD, increased by 8.6% over the same period in 2015 and accounted for 71.5% of export turnover in 2015. Exports excluding crude oil in the first 11 months of 2016 reached 111.979 billion USD, increasing by 10.3% over the same period in 2015 and accounted for 70.2% of export turnover.

Imports of the foreign investment sector in the first 11 months of 2016 reached 92.831 billion USD, increased by 3.6% over the same period in 2015 and accounted for 59.2% of import turnover. Generally in the first 11 months of 2016, foreign investment sector has export surplus 21.245 billion USD including crude oil and 19.148 billion USD excluding crude oil.

The investment certificate granting status:

According to the data from the information system on foreign investments, as of November 20^th 2016, there were 2,240 new projects were granted the investment certificates with total registered capital of 13.028 billion USD, equal 96.1% over the same period in 2015. Till November 20^th 2016, there were 1,075 projects register to adjust the capital with the total registered additional capital of 5.075 billion USD, increased by 76.1% over the same period in 2015.

Generally in the first 11 months of 2016, the total newly registered and additional capital reached 18.103 billion USD, equal 89.5% over the same period in 2015.

According to the investment areas:

In the first 11 months of 2016, foreign investors have invested in 19 areas, in which the processing and manufacturing industries are areas attracting more attention of foreign investors with 907 newly registered investment projects and 766 adjusting capital projects, the total newly registered and additional capital reached 13.41 billion US dollars, accounting for 74.1% of total registered capital in 11 months.

The real estate sector ranks 2^nd with 49 newly licensed projects, with the total newly registered and additional capital reached 740.93 million USD, accounting for 4.1% of total registered capital. The professional activities, scientific and technological sectors ranks 3^rd with 684.84 million USD, accounting for 3.8% of total investment capital.

According to the investment partners:

In the first 11 months of 2016, there are 68 countries and territories having investment projects in Vietnam. Korea leds with total newly registered and additional capital of 5.29 billion USD, accounting for 29.2% of total investment capital in Vietnam; Singapore ranked 2^nd with total newly registered and additional capital of 2.05 billion USD, accounting for 11.3% of total registered capital; Japan ranked 3^rdwith total newly registered and additional capital of 1.95 billion USD, accounting for 10.8% of total investment capital.

According to the investment location:

In the first 11 months of 2016, foreign investors have invested in 54 provinces and cities. In which Hai Phong attracted the largest foreign investment with 45 newly licensed projects and 35 projects register to adjust capital. The total newly registered and additional capital reached 2.74 billion USD, accounting for 15.2% of total investment capital.

Binh Duong ranked 2^nd with total newly registered and additional capital reached 1.93 billion USD, accounting for 10.7%. Followed by Dong Nai, Hanoi, Ho Chi Minh City with total newly registered and additional capital reached 1.87 billion USD, 1.84 billion USD and 1.32 billion USD respectively.

Some large projects that are licensed in the first 11 months of 2016:

– LG Display Hai Phong project, licensed on April 15^th 2016, the total registered capital is 1.5 billion USD, which is invested by LG Display Co., Ltd (Korea) to manufacture and produce plastic OLED display products for mobile devices such as cell phones, smart watches, tablets…

– LG Innotek plant project in Hai Phong, the total registered investment capital is 550 million USD, invested by LG Innotek Co., Ltd. (Korea) to produce camera module.

– The project to develop the port and industrial parks complexes in Dam Nha Mac area, Quang Yen Town, Quang Ninh province, invested by CDC International Corporation (Cayman Islands) with total registered investment capital of 315.46 million USD.

– Amata Long Thanh City project, with total investment capital of 309.3 million USD, invested by Thailand investors to build urban area in Dong Nai.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn

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Benefits of Setting Up Business in Danang

Danang is considered an ideal destination for investment. The result shall be incredible where we evaluate on the following aspects:

Danang – one of the strategic economic centers of Vietnam’s central region

In March 13^th, 2004, the prime minister signed a decision to establish central region’s strategic economic center, including 05 provinces and cities: Thua Thien Hue, Danang, Quang Nam, Quang Ngai and Binh Dinh to promote potential, geographical location and competitive advantages and step by step develop this economic region to become one of the most dynamic economic region in the country. In particular, Danang is defined as the role of nuclear motivation for promoting the development of the central region and the highlands.

Danang – eastern gateway of east – west economic corridor (EWEC)

EWEC is one of five economic corridor developed by the initiative of the Asia development bank in the greater Mekong sub – region.

Benefits of Setting Up Business in Danang

Currently, the road system in Laos, Thailand and the road line from Danang to Savannakhet are completed. The second international bridge spanning the Mekong river was completed in the end of  2006 to facilitate the circulation of goods and passengers by road line from Danang to the northeastern provinces of Thailand and vice versa. East-west economic corridor not only provide an opportunity for the country on the path of promoting regional cooperation and improve living standards for the people but also enable businesses better access to the raw materials market services, capital, labor and technology with the purpose of creating favorable conditions for investment and trade across the border and diversifying economic activity and exports and promoting tourism development

Danang – entrance of the cultural heritage and natural wonders of the world

Danang is located in the heart of the “world heritage road”, stretching from the central coast of Vinh city to Da Lat city. From Danang, along the national highway 1A, visitors can access quickly and conveniently four of five world heritages in Vietnam, including Phong Nha – Ke Bang national park (about 300 km from the north of Danang), the ancient capital of Hue (about 100km from the north), Hoi An (about 30km from the southeast) and My Son (about 70 km from the southwest).

With the advantage of geographical location and potential economic development in tourism, Danang is an ideal destination for tourists as well as investors.

Infrastructure is step by step improved

Danang is an important traffic hub of the central  – highlands and country with system of international airports, deep sea ports, roads, north-south railways  developed conveniently.

Danang port is the third largest commercial ports in Vietnam after Saigon port and the port of Haiphong. With a depth of 11m wharf, warehouse systems and equipment upgraded by capital funds of the government of Japan, Danang port can receive ships with a capacity of 45,000 dwt and others such as container ships, passenger ships, cargo ships. Danang is the international shipping route anabling to go to Hong Kong, Singapore, Japan, Taiwan and Korea.

Danang international airport is one of the three best airports in Vietnam. In addition to domestic flights, there are weekly international flights directly from Danang to Singapore, Bangkok, Taipei. In the near future, the airport will open more routes to Hong Kong, Japan and Korea. Danang international airport is currently being upgraded and expanded to meet the needs of increasing passengers and cargos.

The system of roads in and out of the city are constantly being expanded and newly constructed

Telecommunication systems: Danang is one of three major telecomunication centers of the country, international transmission speed with good quality of  Southeast Asia. Danang post provides various and modern telecommunication services and be capable meeting the needs of customers.

The other services supporting investment (financial, banking, insurance …): most banks and finance companies of Vietnam have large branches in Danang. Some branches of foreign banks and international insurance companies are operating effectively in the city. These services have increasingly been improved better to meet the needs of investors.

Trained and abundant human resources

Danang has abundant human resources (over 50% of the population of the city), mostly young labor. Number of employees with technical expertise trained account nearly a quarter of the labor force. Labor costs in Danang are lower than some other cities in the country.

Danang is one of the provinces in the country with the high educational development index which create a favorable platform for the development of human resources of the city to perform the goal of improving the quality of human resources, quality of life. The city has about 14 universities, 15 colleges and professional schools with nearly 140,000 students. This system performs training in most areas of science, engineering, information technology, economics, business administration, language and pedagogy… Danang university also cooperates with universities of countries with an advanced education such as France, US, Japan, Australia, Canada, New Zealand …

Software technology center in Danang is one of the leading software producers in Vietnam and is the leading training center of the central region. Over the years, the software technology center  has cooperated closely with companies of India (aptech) and Japan (aots) to train programmers, technicians and engineers reaching the international standard.

In addition, the city also has about 55 vocational training centers which often provide short-term training courses in computer science, sewing, mechanics, electricity – electronics, construction techniques, etc …

Quality of life

Along with the process of urbanization, economic growth in recent years has helped to material life and spirit of the people of Danang continuously improved.

Unlike other large cities in Vietnam, next to the bustle of urban development, living in Danang always bring a sense of peace, comfort and closeness to nature. Danang is one of the very few cities in Vietnam having a harmonious combination between high mountains, deep forests, long beach, deep river. After work, you can easily find space to relax beside the river or on beautiful beaches.

Danang today is a city with a healthy cultural environment, with urban civilized lifestyle, literacy levels elevated, beautiful natural scenery. It can be said that Danang is an exciting place to live, work, travel  and invest in Vietnam.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows. We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 . To learn more about us, please visit www.antconsult.vn

Source: Antconsult.vn

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Many Foreign Brands Are Coming to Vietnam

Realizing that Vietnam is a promising market, foreign enterprises want to do business in Vietnam through the form of franchising. Recently, many consumer goods, fashion and cosmetics brands from Japan and Thailand are promoting the franchise with Vietnamese partners and enterprises.

In the framework of the program “Vietnam – Thailand Enterprises Interaction in The Field of Franchising” which was held in Ho Chi Minh City (HCMC) recently, there were 40 Thailand enterprises operating in the food, beverage, restaurant, supermarket, health care, cosmetic sectors joined to find partners in Vietnam.

According Mr Nupartpat Sutthitham, Director of the MP Mart convenience store chain (Thailand), currently in Thailand there are 3 MP Mart stores, in which the model is not the same as Family Mart or Circle K. While Family Mart sells mainly food (80%), MP Mart sells mainly fast moving consumer goods, which are produced in Thailand (70%).

According to representatives of MP Mart, the cost to open a store in Thailand with an average area of 150 m2 is approximately 50,000 USD. Realizing the Vietnam market has many opportunities, MP Mart wants to explore and this is the first time this brand comes to Vietnam. The criteria for selection of investors, partners of MP Mart are having financial resources to be able to scaling this model in large numbers in Vietnam.

Meanwhile, according to representatives of Kokekokko – a well-known chicken fast food brand in Thailand with 5 stores, using Japanese spices to marinate chicken. Representatives of this brand also did not hide their intention to find partners with business understanding and financial resources to open stores in Vietnam.

Also in late November of 2016, there were 9 Japan enterprises with 14 fashion brands came to Vietnam to find partners to open franchise stores or distribute products in the domestic market.

According to Mr Akira Kaise, representatives of I Am Company Limited, this fashion brand has been presented in many markets around the world such as Hong Kong, Shanghai, Korea, Taiwan, Spain, UK, Netherlands… and this is the first time he comes to Vietnam to study the market.

Representative of I Am Co., Ltd commented that young population, good economic development, increasing people’s incomes… are factors to make Vietnam becoming a potential market for fashion items. In addition to the market penetration, the Company is also interested in outsourcing or investing in Vietnam to take advantage of low labor costs and highly skilled labors.

At the Vietnam market, Japanese businesses are often mentioned in the culinary field, meanwhile, the fashion, cosmetics or beauty brands are not widely known by consumers. Thus, recently, many Japanese cosmetic brands have decided to enter the market of Vietnam and looking for official distributors.

In an activity operated by the Esuhai Company of Vietnam recently in HCMC, there were nearly 10 cosmetic brands of Japan participated. Among them, the brand Kose is well known by many consumers.

According to the representative of Kose, this enterprise has been established since 1946, global sales reached 2.1 billion USD a year and has been presented in 18 countries. However, so far, this brand does not have official distribution channel in Vietnam market. Therefore, along with the promotion of market presence and product introduction, on this occasion, Kose desires to find agents and official partner in Vietnam.

Meanwhile, according to representatives of Nippon Menard Cosmetic Company, owner of the brand Menard, the Company is fully confident to introduce their products to consumers in Vietnam and wanted to find good partners to be able to access to more consumers.

According to the representatives of the Japan External Trade Organization (JETRO) in HCMC, Vietnam currently has more than 93 million populations, of which half are women who want to become more beautiful as earnings are improving and willing to spend the budget for beauty and body care. Therefore, this is a favorable time and good opportunity for the Japanese cosmetics brand to penetrate the market of Vietnam.

However, there is the fact that the Japanese cosmetic and fashion products are priced relatively high compared to the average income of local consumers. In addition, the Japanese fashion is not common in Vietnam market. Therefore, this is seen as the first step for the fashion and cosmetic brands of Japan to explore the market and find partners.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn

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GE begins $1.5 billion wind power push in Vietnam

The company wants to tap the market with huge power demand for economic growth.

The multinational conglomerate General Electric is teaming up with a partner to construct large-sc

ale wind power plants in Vietnam with a total investment of $1.5 billion.

The company recently signed a partnership deal with the Ireland-based Mainstream Renewable Power Ltd. to develop 1,000 megawatts of wind power capacity for the national grid, according to the Wall Street Journal.

GE will be responsible for partially providing technology for the projects, considered part of its efforts to push further into fast-growing markets. Construction is expected to begin in 2018.

“Vietnam is going to be a huge importer of energy as the economy grows. There is huge demand for power and they can balance the equation with renewable energy,” Mainstream Renewable CEO Andy Kinsella was quoted as saying.

Vietnam's fast-growing economy is in need of more electricity.

Founded in 2008, the Dublin-based Mainstream Renewable Power Ltd. is a major independent power supplier to developing economies like South Africa and Chile.

This will be among the largest clean energy power projects in Vietnam funded by foreign investors.

Various media reports suggest that investors in general are reluctant to develop wind power projects because prices in Vietnam are not high enough to cover the investment.

In Vietnam, state-owned Electricity of Vietnam, which controls the national grid, reportedly pays 7.8 cents or VND1,731 per kilowatt-hour for wind power, much lower than the rates in China, Japan and the Philippines.

The Vietnamese government has set a target of increasing its power output from about 200 billion kWh in 2015 up to over 330 billion kWh by 2020.

Last month, German firm Terra Wood proposed a solar energy project worth $400 million in the central province of Quang Ngai.

Two months ago, Singapore's The Blue Circle was licensed to build a $60 million wind power project in Ninh Thuan, also in the central region.

Source: Bao Vnexpress 

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