Director of KOTRA Vientiane, Commercial Section o f the Embassy of Republic of Korea to Laos, Mr Oh-Hyoung Kwon made the comment on Friday during a trade event which saw more than 30 beauty and health food companies promote their products and seek business partnerships in Laos.

Well-known cosmetic bands from other countries, especially Thailand, are already popular with local consumers but they still don’t know much about Korean beauty products, so the event gave Korean businesses the chance to connect with customers and expand into the Lao market.

Mr Oh-Hyoung Kwon explained the Korea Trade Promotion Corporation (KOTRA) had been assisting Korean companies to enter the Lao market since 2012 and investment has increased each year.

KOTRA has arranged various exhibitions and activities, aimed to promote Korean products to Lao people.

While food, consumer electronics and cars from the Republic of Korea are now widely accepted by local consumers, Korean cosmetics and health products have only been attracting interest in recent years. However, Korean firms believe there is substantial potential in developing products such as skin creams and makeup for Lao customers.

Korean TV series and culture are set to play a part in the promotions to encourage Lao people to use more cosmetic products.

The Republic of Korea is the sixth ranked country for investing in Laos, with some 257 projects that have a combined investment value of US$800 million. Trade volumes between the two countries reached US$199 million last year, with Lao exports to Korea valued at US$12 million and imports from the republic at US$187 million, according to the Ministry of Industry and Commerce.

Imports from the Republic of Korea have grown exponentially in recent years, on the back of growing demand for cars, electronic devices such as smartphones and household appliances.

At the annual shareholders’ meeting in Ha Noi yesterday, Vinatex General Director Le Tien Truong said that the group would focus on supporting its subsidiaries in trade promotion to enlarge export markets to meet the target.

The group would also set up research boards on free trade agreements to take up the initiative in building effective business and investment strategies, Truong said.

Vinatex has invested in developing supply chains from materials to finished products over the past year. After launching operations of the Kien Giang project in 2015, the group is completing the Phu Hung Fibre Plant and a yarn dyed cloth project.

Besides, the group has also developed the Supply Chain Development Centre (SCDC) to be dependent on material sources. So far, the SCDC has eight regular customers for garment products and has been developing 20 customers in the United States, Europe, South Korea and Japan.

The centre has had 10 customers for cotton and fibre and has been developing 30 customers for its products in Chile, China, Thailand, and Malaysia, in addition to South Korea.

Vinatex gained good business results last year with high growth rates from 7 per cent to 13 per cent from most of its large export markets. The group reported an export value of $2.37 billion and a pre-tax profit of VND628 billion last year.

The HCM City – Sihanoukville route launched on June 17 and is Angkor Air’s third route in Vietnam.

The airline will conduct five round-trip flights per week on the route, using 70-seat ATR 72 aircraft.

The new route is expected to help Cambodia attract Vietnamese tourists and others to Preah Sihanoukville, contributing to the port city’s economic and tourism development.

Preah Sihanoukville has welcomed an increasing number of Vietnamese visitors recently, including 11,200 in the first quarter of this year.

The study by human resource firm Page Personnel found that contracting professionals with specialised skills, higher education and more years of experience are increasingly the norm in Asia’s workforce today.

Reflecting similar trends in the global landscape, contract employees are also expected to work autonomously and be more flexible while on assignments, the survey found.

The study took in responses from 1,954 managers in companies deploying temporary staff and 4,092 professionals across 65 countries around the globe.

“Due to the changing economic landscape, Asia has seen an increased demand for professional and qualified contractors. Expectations of contract staff have also risen -they’re expected to do more in less time, have better educational qualifications and be able to work independently,” said Page Personnel Singapore associate director Mellissa Mayne.

The findings come just after the Ministry of Manpower, the labour movement and the Singapore National Employers Federation released a set of guidelines on Monday which clarified the benefits that contract staff are entitled to.

For example, the guidelines encourage employers to treat contracts renewed within a month as continuous, and grant leave benefits based on the cumulative term of contracts, for contracts of 14 days or more.

Traditionally, contracting was limited to professions considered labour-intensive and at the junior level. As a result of increased demands for project management or specialised interim hiring, contracting opportunities for qualified professionals have grown, Page Personnel said.

This has also resulted in 56 per cent of the current contract workforce qualified with 10 years or more experience.

This was seen particularly within financial services, finance and accounting, secretarial and office support as well as information technology.

Communication skills have become a major requirement from contract employees as 90 per cent of those surveyed are expected to engage with other internal business units.

Contract employees are granted more autonomy as 79 per cent of respondents reported having to work without close supervision.

Last month, it was the first bank from Myanmar to win a licence for a rep office in Bangkok. The bank says the licence granted by the Monetary Authority of Singapore (MAS) marks another step towards the goal of becoming Myanmar’s foremost commercial presence in Southeast Asia and internationally.

“The flow of investment from Singapore now exceeds that of China, and much of the investment from other regions in the world passes indirectly through Singapore. Having a KBZ team on the ground assisting these businesses with market entry ensures that capital passes through KBZ Bank and supports its position as Myanmar’s leading financial institution,” said Zaw Lin Aung, who will lead the Singapore office.

He is the deputy managing director of KBZ Bank for small and medium-sized enterprises.The bank is hopeful that visa-free travel between Myanmar and Singapore, coupled with Singapore’s significant flow of investments to Myanmar, will serve to further the ease of doing business between the two nations.

In the Thilawa Special Economic Zone, Singapore leads among 14 countries investing in the area, with investment of US$298.15 million (Bt10.5 billion). In the past two years, Singapore led foreign investment in Myanmar, with oil and gas, manufacturing and telecommunications, real estate and hospitality as the key industries in focus.

The services being offered through this office include market research, liaising between the two countries’ private sectors, and serving as a source of information, including regulatory requirements for doing business in both Singapore and Myanmar.

“As the largest bank in Myanmar, we are able to use our extensive knowledge of the country’s financial markets to catalyse responsible trade between the countries,” Zaw Lin Aung said.

Since late 2015, KBZ has been working alongside the Monetary Authority of Singapore to establish this presence. That process involved the provision of strong financial information and creditworthiness, as well as many meetings with the Monetary Authority of Singapore to demonstrate transparency, professionalism and capability.

A search for the office’s location is underway.

The Philippines was Southeast Asia’s fastest-growing smartphone market in the first quarter of 2016, with a big boost coming from local brands selling inexpensive models, research firm International Data Corporation (IDC) said.

IDC, citing its Asia/Pacific Quarterly Mobile Phone Tracker, said a total of 3.5 million smartphones were shipped to the Philippines in the first three months of 2016. That translated to a year-on-year growth of 20 per cent.

“While many of the more mature smartphone markets of the world already displayed signs of saturation, the Philippines smartphone market continues to enjoy robust growth owing to a relatively low smartphone penetration rate, active local brand presence, and healthy consumer spending,” Jerome Dominguez, IDC Philippines market analyst for mobile devices, said in a statement.

He said local handset makers still dominated the Philippine market, flooding it with affordable smartphone options.

“Smartphones priced below 3,500 pesos (US$75) still make up the majority of smartphones shipped to the Philippines,” he said.

He noted MyPhone’s successful budget my28S model was the most purchased model during the first quarter.

“However, this is no reason for the homegrown brands to rest on their laurels as global and Chinese vendors are gradually catching up on the budget segment,” Dominguez said.

The past few quarters have shown vendors like Samsung and Asus playing more aggressively in the lower-than-6,000-peso space, IDC noted. China-based vendors Oppo and Huawei are also on a “steady growth track” as they continue to expand channel coverage.

“As the Philippines smartphone market matures and shifts from being an acquisition game to a replacement one, consumers are expected to demand more from a smartphone in terms of specs and performance,” Dominguez said.

He added vendors should not be complacent and foster innovation and improve product quality and after-sales services to stay ahead of the game.

“Defect issues and poor after-sales continue to plague the smartphone market. It is only a matter of time before majority of Filipino consumers put more premium on smartphones that are not just easy on the pocket but also offer good value for money,” Dominguez said.

IDC expects smartphone shipments to the Philippines to grow by 25 per cent this year .

Moreover, telco operators should keep an eye out for further network congestion and adjust as the use of smartphones expand.

“Mobile data explosion is an inevitable consequence of the growing smartphone user base so telcos should carry on with further expansion of their capacity and footprint nationwide,” Jubert Albeto, IDC Philippines country head, said in the same statement.

US$1 = 46.35 pesos as of 6/20/2016 via oanda.com

They include BIDV, Vietcombank, Vietinbank, Agribank, TPBank, Techcombank and SHB. But the number to do so accounts for a modest proportion of the total number of banks.

What prevents other banks from cutting lending interest rates?

Loan interest rates at most banks range from 7 to 11 per cent (average 8.5 per cent), while their average cost of capital is 7.8 per cent.

This means that their interest rate spread is often insignificant.

So what can banks do to lower lending interest rates without affecting their spread?

The spokespersons of some banks have said they are trying to cut costs but also are trying to make do with lower profits. However, they cannot cut deposit interest rates since it has other risky implications.

Many analysts say reducing the lending interest rates is not just the responsibility of the banks but also of the Government.

After all, it had relentlessly issued bonds at high interest rates and the market relies greatly on them to determine interest rates.

This year, for instance, by May the State Treasury had mobilised 147 trillion dong (US$6.533 million) by issuing government bonds via auctions and its main customers were banks.

To stop banks from investing in its bonds the Government needs to cut public spending, which is often financed by bonds issuances that put upward pressure on interest rates.

According to a report from the Central Institute for Economic Management, in the first quarter of this year the budget deficit amounted to 47.1 trillion dong ($2.1 billion), equivalent to 5.53 per cent of the gross domestic product, or higher than the 4.61 per cent in 2015, 4.91 per cent in 2014 and the average of 4.86 per cent in 2011-15.

If the deficit is not reined in, the Government’s fiscal leeway will narrow and the pressure to issue bonds will increase.

Another problem that prevents the banks from cutting the interest rates is the high incidence of bad debts and the central bank’s tardy pace of dealing with them.

After years of high bad rates, banks are beset by liquidity problems. The central bank should soon provide the banks with refinancing loans at low interest rates and special bonds from the VAMC against bad debts it buys.

It should also quickly clean up the bad debts so that banks’ liquidity improves and they can cut their interest rates.

Reducing compulsory reserves and bank liquidity reserves is another imperative that would release around 100 trillion dong ($4.44 million) worth of funds.

Government bonds remain attractive

Government bonds have been popular this year and in fact are considered the favourite asset class for credit institutions and foreign investors.

The State Treasury said in May bond issuances raised 43.34 trillion dong ($1.93 billion), almost half higher than in April, with five-year papers being the bestsellers, accounting for 77 per cent.

Liquidity in the economy and buying by foreign investors have been the prime reasons for the heavy buying.

For banks it was not the peak lending period, meaning many of them were sitting on piles of cash from short-term deposits.

According to the Ministry of Planning and Investment, the banking sector’s credit grew by only 4.52 per cent as of May 20.

The Treasury, on its part, saw this as an opportunity to mop up cash.

The banking sector has been awash in liquidity: the central bank has mopped up nearly 20 trillion dong via open market operations while the interbank interest rates have dropped sharply across the board.

The interest rates for overnight to one-week loans on the interbank market last week plunged to the lowest level in more than one year after the central bank issued Circular 06/2016/TT-NHNN to reduce banks’ adequacy ratios.

The overnight rate fell by 32 basis points to 1.46 per cent a year and the one-week rate dropped 51 points to 1.55 per cent.

The central bank has also been buying a lot of foreign exchange to increase its reserves to an estimated $7 billion now.

Foreign investors have been very active on the bond market, the primary market since Vietnam does not have a secondary bond market.

In the last week of May alone, for instance, their buying topped 2.2 trillion dong, taking their total net buying this year to 10.7 trillion dong.

The treasury plans to issue bonds worth 70-80 trillion dong in the second quarter, most of them for short terms.

It expects to easily achieve this target since in its recent Circular 06 the central bank increased the maximum rate of short-term deposits that can be invested in government bonds from 15 per cent to 35 per cent for foreign banks and to 25 percent for state-owned banks.

This means dozens of trillions of dong worth of bonds are likely to be sold.

US$1 = 35 dong as of 6/20/2016 via oanda.com

This is 14.8 per cent more than the 952 billion pesos recorded in 2014, the Philippine Statistics Authority (PSA) said in a statement.

The contribution was measured in terms of tourism direct gross value added (TDGVA) to total gross domestic product (GDP).

PTSA data also showed that inbound tourism expenditures continued to increase, growing by 10.7 per cent to 306.6 billion pesos in 2015 from 276.9 billion pesos in 2014.

Inbound tourism expenditure refers to how much nonresident visitors (foreign visitors and Filipinos permanently residing abroad) spend while visiting the Philippines.

Compared to the country’s total exports, the share of inbound tourism expenditure was 8.2 per cent.

It also ranked third among the biggest export items in 2015, after miscellaneous services at 29.8 per cent and semiconductors at 22.8 per cent.

Domestic tourism expenditure, which includes expenses of resident visitors within the country either as domestic trip or part of an international trip, similarly grew by 26.1 per cent to 1.77 trillion pesos last year from the 1.4 trillion pesos in 2014.

This figure represents 18 per cent of the household final consumption expenditure (HFCE) in 2015, the PSA said.

According to the PSA statement, employment in tourism-related industries reached some 5 million in 2015, up by 3.4 per cent compared to 4.8 million in 2014.

The share of employment in tourism industries to total employment stood at 12.7 per cent in 2015.

Meanwhile, data released by the World Travel and Tourism Council (WTTC) earlier this year showed that the Philippine travel and tourism industry contributed a total of 1.43 trillion pesos to the local economy in 2015, equivalent to about 10.6 per cent of the country’s GDP.

The industry’s total contribution—which reflects not only the economic activity of directly related industries, but also the wider effects from investments and the supply chain—is also expected to rise by 6.6 per cent this year, and to 2.6 trillion pesos by 2026, data from the WTTC’s Travel and Tourism Economic Impact 2016 report showed.

The industry’s direct contribution—or the economic activity generated by industries such as hotels, travel agents, airlines and other passenger transportation services—meanwhile rose to 569 billion pesos last year, equivalent to 4.2 per cent of total GDP. Direct contribution is similarly expected to grow by 6 per cent to 604 billion pesos this year, and by 5.3 per cent yearly to 1 trillion pesos by 2026.

US$1 = 46.34 pesos as of 6/20/2016 via oanda.com

A first-phase opening of the new “Terminal 3 Ultimate” had been scheduled for today, initially to serve passengers on domestic and international flights operated by national carrier Garuda.

Indonesian Transport Ministry officials had deemed it “too risky for the terminal to operate with back-up electricity still not online, a disrupted view from air traffic control tower to apron, incomplete signs and dysfunctional toilets”, according to a Jakarta Globe report last Saturday.

Transport Minister Ignasius Jonan had expressed concerns over ground safety during a visit to the new terminal last Tuesday, The Jakarta Post reported.

The ministry will conduct another inspection of the 4.7 trillion rupiah (US$353 million) facility today before a new opening date can be set, state airport operator Angkasa Pura II said, according to the reports.

“It’s likely the operation will be postponed until after Idul Fitri,” Angkasa Pura II operations and engineering director Djoko Murjatmodjo told the Jakarta Globe.

Eid Idul Fitri is the Muslim holiday marking the end of the Ramadan month of fasting. Celebrated as Hari Raya Aidilfitri in Singapore, the holiday falls on July 6 this year.

Addressing the problems raised by the ministry, Djoko said the state airport operator has back-up facilities to ensure operations at the new terminal remain uninterrupted in the event of a power outage, which he said is a rare occurrence in the region.

The operator has also set up a portable mobile air traffic control tower to support the main control tower in monitoring “blind spots” at some of the aprons of Terminal 3 Ultimate. But during its final check last Thursday, the Transport Ministry deemed the borrowed tower insufficient to meet civil aviation safety regulations.

Angkasa Pura II has planned for Terminal 3 Ultimate to go fully operational in March next year and serve international flights from other carriers including Air France, China Airlines and Dutch carrier KLM. It is also expected to become the only arrival and departure point for international passengers in future.

When fully operational, it will be able to handle some 25 million passengers a year, adding to the 52 million that now pass through Soekarno-Hatta’s two terminals.

Spanning 422,804 sq m, the new terminal is slightly larger than Changi Airport’s Terminal 3 and will have 10 gates for international flights and 18 for domestic ones, two four-star hotels and duty-free shops, among other facilities.

Indonesian officials hope that with the opening of the new terminal, Soekarno-Hatta will be able to rival Changi and Kuala Lumpur International Airport, and lure international passengers to choose Jakarta as a transit point.