The information was released in Circular 216/2015/TT-BTC by the Ministry of Finance about import and tax rates for implementation of bilateral trade agreements between Vietnam and Laos.

The Circular 216 stipulates a list of goods originating from Laos imported into Vietnam that will enjoy a tax reduction of 50 per cent under ATIGA (ASEAN Trade in Goods Agreement).

The circular also stipulates that in case export tariffs in the ATIGA are higher than the tariff regulations in the Most Favoured Nation (MNF) Rules, imported goods will be subject to a 50 per cent tax reduction under the MNF.

Goods subject to tax reductions will include preserved or cooked poultry and birds’ eggs, rice, sugarcane or refined sucrose.

The provisions on non-tariff incentives, the Circular 216 also issues instructions on guidelines and conditions applied for a tariff rate regime at zero per cent for tobacco and rice annually.

Specifically, imported items eligible for 50 per cent tax incentives, must fulfil the following conditions:

1.) It will consist of customs declaration of imported goods from October 3, 2015. 2.) Goods must be imported and transported directly from Laos into Vietnam. 3.) Imported items must have certificate of origin form S issued by Laos authorities.

If the volume of imported unmanufactured tobacco and tobacco refuse exceeds the quantity of quota regulated by Vietnam’s Ministry of Industry and Trade, it will be subject to a tax rate under the Circular No.80/2014/TT-BTC.

This circular dated June 23, 2014, of the Ministry of Finance amends and supplements its Circular No. 111/2012/TT-BTC of July 4, 2012, promulgating the list of commodities and their import duty rates for application of tariff quotas.

This circular is to add the over-quota import duty rates of unmanufactured tobacco and tobacco refuse under sub-heading 2401.10.40.

Three kinds of imported rice from Laos will also enjoy tax incentives at 0 per cent. Of the rice volume, quota for rice imports is 70,000 tonnes and quota for tobacco imports is 3,000 tonnes, according to the Circular 216.

An anonymous source from the tender scrutinising committee said that their bids would be shortlist and the result would be announced in the second week of this month.

Myanmar Railways, under the Ministry of Rail Transportation, invited bids for a mixed-use development project for the land spanning 63.622 acres or about 160 rai. The plot is tentatively designed to house high-rise hotels and commercial buildings. It is an essential part of Greater Yangon City development project.

It called for bids early 2015 but there was no winner. The second tender was announced in August.

According to Energy and Mineral Resources Minister Sudirman Said, 12,669 villages are disconnected from the electricity grid, most of them located in the provinces of West Nusa Tenggara, East Nusa Tenggara, Papua, West Papua, North Maluku and East Maluku.

“It will be one of our areas of attention to tackle the gap within three to four years,” Sudirman said after signing a Memorandum of Understanding (MoU) with the Financial Services Authority (OJK) in Jakarta on Wednesday.

On the other hand, Sudirman continued, the government had yet to capitalize on Indonesia’s renewable energy potential, utilizing only 3 per cent of the total estimated potential of 300,000 megawatt.

“By 2025, we need to boost the renewable energy portion in the energy mix from the current 6.8 per cent to 23 per cent,” Sudirman explained, adding that up to Rp 1,600 trillion of investment were needed to meet this target.

Therefore, the ministry and the OJK signed the MoU on the acceleration of renewable energy development by increasing the role of financial institutions, given the fact that the state budget only allocates around Rp 2 trillion per year for developing renewable energy.

OJK chairman Muliaman Hadad added that several financial institutions had committed to invest up to Rp 3 trillion into renewable energy this year.

“At first [it will be] Rp 1 trillion, but later it will increase to Rp 3 trillion rupiah in 2016. Hopefully, it will become the first step of sustainable investment in renewable energy,” he said.

A senior official from the provincial authorities delivered a report during the signing ceremony of the land concession for the new tea processing plant. Present were representatives from the provincial land management office and the Chinese company, with the ceremony held recently in the province.

The new plant, which has been built in Pakbaeng district, will have the capacity to process up to 8,000 tonnes of tea per year, adding fuel to the province’s tea production potential.

Currently, there are only a few small-scale tea processing plants operating in the province. “The new plant is able to produce a better quality of tea products,” the official from the provincial investment promotion section said.

Tea is now being grown on over 8,000 hectares of land in 11 villages in the district. Tea planting and processing has the potential to be one of major cash crops for the province and local authorities have encouraged farmers to cultivate it on a commercial basis in a bid to drive economic growth.

Export products grown in Oudomxay also include rubber, sweet corn, bananas and other crops.

“Despite that tea is not our main export product,” department official Khamchack Laocheubeng said, adding that the province has the potential to further expand tea planting initiatives in the future.

The province also has wild tea trees aging from 400 to more than 1,000 years old, whose leaves fetch considerably high prices on international markets.

“We have set a clear plan to continue promoting tea planting and production, through collaboration with Chinese investors,” he said.

In addition to tea, the provincial authorities will continue promoting animal husbandry enterprises to alleviate poverty and improve the living conditions of local residents, whose incomes remain relatively low.

The average income per capita of the province’s residents is only just over 9 million kip (about US$1,000) per annum.

In order to maximise the potential of these cash crops, the provincial authorities recognise the need to upgrade the knowledge of technical staff so that they can provide better planting know-how to local farmers.

“More training courses will be conducted, along with on-the-job experience as well,” he confirmed.

Due to the labour-intensive nature of the industry, the rise in the levy from 590 ringgit to RM1,500 per month will see planters forking out an additional RM910 per worker.

This is based on the feedback from industry players, who expect the impact to be felt in their bottom line this year.

Yesterday, major plantation companies that are part of the FTSE Bursa Malaysia KL Composite Index (FBM KLCI) were among the largest decliners on the exchange.

Sime Darby Bhd fell 50 sen to close at 7.57 ringgit, while IOI Corp Bhd fell 23 sen to 4.62 ringgit. Kuala Lumpur Kepong Bhd fell 40 sen to close at 23.50 ringgit. All together, the three contributed to a decline of eight points in the FBM KLCI. The index fell 14.62 points to close at 1,653.18 points.

Industry players generally are expecting a potential cut in their earnings of between 3 per cent and 8 per cent this year from the unexpected hike in the foreign worker levy, which takes effect this month.

CIMB Research expects a potentially higher earnings cut at Felda Global Ventures Holdings Bhd (FGV) and Hap Seng Consolidated Bhd, given their lower earnings base and higher earnings exposure to palm oil.

Depending on the sheer size of their foreign worker workforce, the research unit expects that listed planters would need to pay an additional cost of between 5 milion ringgit and 30 million ringgit this year for the new levy.

Currently, foreign workers represent about 80 per cent of the total workforce in oil palm estates nationwide. The key cost components of crude palm oil (CPO) production are fertilisers, labour and plantation upkeep, with labour and fertiliser representing over 50 per cent of the total.

The labour cost (especially palm fruit harvesters) alone is about 30 per cent of local planters’ current total cost of production, which averages about 1,450-1,500 ringgit per tonne of CPO. In Malaysia, most listed plantation companies generally hire over 6,000 foreign workers, with FGV and Sime Darby Bhd being the highest, each hiring almost 30,000 foreign workers.

CIMB Research in its latest report said FGV and Sime Darby could end up paying an additional cost of over 20 million ringgit this year from the new foreign worker levy, while other planters with below 10,000 foreign workers could fork out between 5 million and 10 million ringgit this year.

FGV group president and chief executive officer (CEO) Datuk Mohd Emir Mavani Abdullah told StarBiz that the sudden move would push up the company’s cost drastically.

FGV currently employs 29,000 foreign workers across its 134 plantations, he said, adding that “the company is still in need of another 5,000 workers to ensure continuous effectiveness in its plantations”.

FGV would like to highlight that the palm oil industry as a whole has been affected by the slump in CPO prices and the strengthening of the US dollar.

The CPO price slumped to a six-year low in August 2015 and the US dollar strengthened against the ringgit by 18 per cent, with the US dollar and ringgit exchange rate closing at a high of 4.45 ringgit in December last year.

Therefore, Emir said FGV was appealing to the Government to reconsider its decision to increase the levy for foreign workers in the plantation sector.

“The increase is bearable for the FGV Group only if the CPO price goes above 2,800 ringgit per tonne,” he added.

The three-month CPO futures contract is currently trading at its highest since May 2014, up by 77-2,520 ringgit per tonne as at 5pm yesterday. For Sabah-based IJM Plantations Bhd, its CEO and managing director Joseph Tek Choon Yee said: “With our over 3,500 workers and the additional 910 ringgit per worker under the new levy, it will work out to be about 3.2 million ringgit this year.”

Tek, who is also the Malaysian Estate Owners Association president, said the association was hoping that the authorities would reconsider this unabated and untimely 154 per cent hike, given the low crop production on the back of the rising cost of production and unattractive CPO spot prices. In the context of Sabah planters, there are many dependents in addition to the workers.

“The dependents are less productive and they too need to be subjected to the levies and subsequently are also subjected to the supposed increment in the minimum wage to be implemented this July,” added Tek.

Meanwhile, oil palm plantation players at a dialogue session with Plantation Industries and Commodities Minister Datuk Amar Douglas Uggah Embas hosted by the Malaysian Palm Oil Council in Kuching yesterday have also raised concerns over the new foreign worker levy.

Sarawak Oil Palm Plantation Owners Association chairman Datu Vasco Sabat Singkang said the new levy on foreign workers came as a big shock for its members as “this would tremendously increase their operational cost”.

He pointed out that most Sarawak planters were heavily dependent on foreign workers, mostly Indonesians, in the estates.

To lessen the impact of the hike, Sabat urged the Government to alternatively extend the number of years for foreign workers allowed to work in Sarawak probably to four or five years.

Tek also urged the Government to defer the implementation of the minimum wage from 900-1,000 ringgit in Peninsular Malaysia and 800-920 ringgit in Sarawak and Sabah from July 1 this year.

On the windfall profit tax on palm oil, he said the Government should consider abolishing it, as “it holds no relevance in today’s environment”.

Tham, who is in his early 60s, is also the agency’s worldwide chief creative officer, and the first Asian and Singaporean to take on that role.

The New York-based pitchman, who has been in the business for about 35 years, had been co-chairman and regional executive creative director for Ogilvy & Mather Asia Pacific for nine years.

He led Ogilvy & Mather to win the prestigious Cannes Lions Network of the Year award four years in a row from 2012. The agency, which has served clients such as Coca-Cola, IBM, Unilever and Louis Vuitton, is one of the largest marketing communications companies in the world and has a network of more than 500 offices in 126 countries.

Tham was also one of four recipients of the Designer of the Year award at the 2009 President’s Design Award in Singapore.

He also served on the high-level Economic Review Committee in 2002, which brought together business, academic and government leaders to find a new strategic direction for Singapore as it evolved from a manufacturing to a knowledge-based economy.

Before joining Ogilvy & Mather, Tham worked at Leo Burnett and Batey Ads. His past work includes advertisements for Singapore Airlines and Raffles Hotel.

His new appointment as co-chairman is a “great honour”, Tham told The Straits Times. He will head the board with John Seifert, who was appointed worldwide chief executive this month. Seifert, 58, has spent 37 years at Ogilvy & Mather and will take on the co-chairman role on September 1. Until then, his predecessor, Miles Young, will continue as chairman.

Said Tham: “Many years ago, when David Ogilvy founded the agency, he said, ’If you don’t sell, you don’t eat’. He was a peerless creative with an unswerving belief in effectiveness…I greatly look forward to working with John Seifert to build upon this proud Ogilvy tradition.”

The 2015 figure is around 3 per cent higher from the 9.43 million visits recorded in 2014, according to data from the Central Statistics Agency (BPS) released on Monday. On a monthly basis, December’s 913,800 visits reflected a 0.16 per cent drop from the 915,300 visits recorded in December 2014.

“Without natural disasters, we could have reached 11 million foreign tourist arrivals,” said Rizki Handayani, the assistant deputy for Southeast Asian tourism promotion at the Tourism Ministry.

Natural phenomena disrupted tourism almost non-stop from July to December last year, from haze that affected areas such as Riau and Jambi, to several volcanic eruptions, such as those at Mount Raung and Mount Bromo in East Java. These incidents forced the closure of various airports.

The country estimates that visits lost to the eruptions and the haze reached around 650,000.

If taking into account foreign tourist arrivals through cross-border posts and those undertaking brief visits or day-trips, an additional figure of 677,409 visitswould have been recorded, and a total of 10.4 million tourist visits booked throughout last year, a 10.2 percent increase from the previous year.

Such data has never been included before, but BPS head Suryamin said it was now covered by the statistics agency given the “significance” of the number.

Tourism Minister Arief Yahya said that the number of foreign tourists recorded last year would generate a positive psychological effect.

“Indonesia’s growth in tourism is better than our competitor countries such as Malaysia and Singapore, although Thailand fared better with 23 per cent growth,” he said in an official statement.

President Joko “Jokowi” Widodo’s administration is targeting 20 million foreign tourist arrivals by the end of his tenure in 2019. The figure is expected to reach 12 million this year.

In doing so, the Jokowi administration has issued free-visa policy for 90 countries, with 84 more countries, including Australia and Brazil, to be added on the list soon. Coordinating Minister for Maritime Affairs Rizal Ramli said the policy had yielded a 19 per cent increase in foreign tourist arrivals last year.

Indonesia Tour and Travel Agency Association (Asita) chairman Asnawi Bahar said he would have positive thoughts of Indonesia’s achievements in tourism throughout 2015, despite the lacklustre data, given the challenges of the year.

“With the natural disasters, those should have affected our industry more,” he added.

He said that the ministry should focus on China and the Middle East this year to achieve this year’s target. China is seen by many as an untapped market with some 130 million outbound trips expected to be made this year, a 10 per cent rise year-on-year, according to data from the China Tourism Academy.

The ministry stated that it would continue developing the country’s 10 emerging tourist destinations including Lake Toba in North Sumatra and Tanjung Lesung in Banten, in its move to boost Indonesian tourism. The Tourism Ministry hopes to form a single management system for each destination.

Sector wide, labour cost roughly forms 20-25 per cent of total cost, it said on Tuesday.

“As such, we estimate a 2 per cent-4 per cent EPS impact for contractors under our coverage. Actual impact on bottomline depends on several scenarios.

“Guidance from contractors is that there should be an element of cost pass through, but it would depend on several factors.

“For contracts that are in progress/outstanding, terms could be renegotiated through additional claims with the possibility of settlement during the final certification of works,” it said.

The government announced that with effect from Feb 1, employers of foreign workers in these sectors would see the levy double from 1,500 ringgit a year to 2,500 ringgit a year.

CIMB Research said this doubling of the levy is a negative surprise for most contractors.

The new 2,500 ringgit annual levy implies a monthly cost of 208 ringgit, on top of the estimated industry average salary of 1,300-1,900 ringgit a month of a foreign worker.

This effectively works out to an 11-25 per cent rise in foreign labour cost, which is deemed manageable.

“Sector wide, labour cost roughly forms 20-25 per cent of total cost. As such, we estimate a 2-4 per cent EPS impact for contractors under our coverage,” it added.

CIMB Research said for contracts that are still in tender, pricing is typically adjusted if the bid is ongoing. In case of new tenders, new regulated cost structures such as higher levy for foreign workers will be usually priced-in. All contractors are losers but some have better buffers

Contractors that have jobs that are largely at the tail-end appear to be the least impacted, while contractors with relatively higher number of orders that have crossed 20-30 per cent milestones are likely to see some margin squeeze before additional claims are recognised.

“Under our coverage, Gamuda could be spared in 2016 as the tender for MRT 2 is still ongoing and its single-project order book for MRT 1 is at the tail-end. Muhibbah could mitigate the higher levy with US$ priced jobs in RAPID.

“The new levy structure is bad news for the sector but should be manageable over time. On the brighter side, following the announcement of the budget revision last week, most projects that are under the original list of Budget 2016 are largely intact. Investors should focus on a potential major recovery in sector newsflow from 2Q16. We believe any share price weakness from this news would be a buying opportunity. Gamuda and Muhibbah Engineering remain our top picks,” it said.

HANOI – The domestic market would continue to thrive in 2016, said Director of the Ministry of Industry and Trade’s Domestic Market Department, Vo Van Quyen.

This prediction has been confirmed by the initial positive retail sales at the beginning of this year.

Quyen told the online meeting held in Ha Noi yesterday that the purchasing power in January, prior to the Tet (Lunar New Year) holiday which falls on February 8, increased 3.5 per cent from the previous month and posted an 11 per cent year-on-year rise.

The purchasing power in the year-end month saw a record high as compared to the past five years while the consumer price index stayed flat compared in December, helping stabilise the domestic market.

He said his agency has ordered the departments of industry and trade in 53 of the 63 provinces and centrally-run cities to ensure that the supply of goods meets demand and at stable prices during Tet, while surveillance should be stepped up to prevent counterfeit and low-quality goods.

In addition, price stabilisation and promotional programmes at 50 supermarkets nationwide have facilitated people in their purchasing.

All of the price stabilisation points have been selling Vietnamese goods and expected consumption in the holiday to be 10 to 15 per cent higher than previous months.

Deputy Minister Tran Tuan Anh said that in addition to exports, the domestic market has received special attention from the ministry, as well as the government and the National Assembly in recent years.

The domestic market is instrumental to national economic growth, Anh added.

However, he asked the department to have specific plans to ensure supply of necessary goods.

Le Ngoc Dao, deputy director of HCM City’s Department of Industry and Trade, said businesses in the city have sufficient supply of necessary products such as vegetables, fruits, seafood and rice for Tet.

The city has also co-operated with neighbouring provinces to provide clean goods to people with 300 booths meeting VietGap standards.

“Abundant goods and stable prices are prepared before and after Tet. The city will have several promotional programmes during the holiday,” Dao said.

“Export turnover of processing sector saw low growth of 2.8 per cent in January. The reason was due to the decrease in export of phones and electronics spare parts,” Nguyen Thuy Hien, deputy director of the ministry’s planning department said.

Hien said export turnover was estimated at US$13.8 billion, increasing 2.2 per cent from the same period last year, while that of imports was $14 billion, making the trade deficit $200 million.

Deputy Minister Anh noted that the sector should make plans to unravel the difficulties facing the processing and manufacturing sector.

The Ministry of Transport also asked to sell the stake of Damen-Song Cam Shipyard under direct negotiation. SBIC had chosen Damen as the strategic investor under the Song Cam Shipbuilding restructuring plan.

The Dutch group’s attempt to buy a 70 per cent stake in Damen Song Cam Shipyard in Thuy Nguyen District, Hai Phong City had been rejected in 2014 due to local stock market regulations that limited foreign investors to 49 per cent of stock in the company, said SBIC.

At that time, the Ministry of Transport (MoT) suggested that they would sell the stake in two packages of 49 per cent first and 21 per cent in the future, but Damen Group did not want to separate the deal.

Since then, Decree No 60, which was issued to guide securities law, removed limits for foreign investors in some sectors, said MoT.

SBIC was in the process of expanding to the international market and restoring its position from foreign investors after restructuring from the collapsed Viet Nam Shipbuilding Corporation or Vinashin, therefore, the purchase of shares by Damen Group in the Song Cam project was crucial for development.

It also helped create the original basis for the co-operation between Damen with other companies in SBIC, said the ministry.

According to SBIC, the co-operation with Damen, one of the leading shipyards in the world, would allow SBIC to benefit from their technology and intelligence, enhance its skilled workers as well as increase the capacity of management and competitiveness.

Song Cam Shipyard has been the most profitable unit of Viet Nam Shipbuilding Corporation or Vinashin. It was also one of the most effective companies among 8 subsidiaries in SBIC.

Song Cam Shipyard reported no losses in the last five years, instead, it secured co-operation contracts with high technical value with Damen. In early 2014, a $60 million Damen – Song Cam Shipyard was inaugurated with 70 per cent of the capital coming from Damen.

Damen Group is an international partner which is familar with the local shipbuilding industry. The Dutch company began its co-operation with Vinashin, which was restructured as the SBIC, more than 10 years ago. Damen group also planned to acquire a 49 per cent stake in the Ha Long Shipbuilding Limited Company, a corporate member of the SBIC when the company launches its initial public offering.

Damen Song Cam Shipyard has the capacity to produce up to 50 hulls and outfit a further 80 vessels per year.