Like a shy lass sleeping in the mountain

The landscape on the way to Si Ma Cai

Mountain adventurers like to compare Si Ma Cai in Lao Cai Province to a shy lass with discrete charms sleeping in the mountain as the beauty of the little-known village lies in the quiet and simple daily lives of different people.


Si Ma Cai is not as frequented as Bac Ha or Sapa, also located in the mountainous province, since it is nestled at the far end of a road near the border with China. Many travel tips are awaiting in the village, although traveling there requires visitors to hold onto their hats and their seats either in a car or on a motorcycle depending on the means they use to travel the nearly 40 kilometers of bumpy, winding road from Bac Ha.

In recent years, the charms of Si Ma Cai have been awakened and have become attractive to travelers by the flower-colored clothes of the ethnic peoples H’Mong and Red Dao, by the greenery of mountains and hills, and by the legends.

Local people explain that Si Ma Cai means a horse market or a place where horses are tied. However, H’Mong people like to talk about Si Ma Cai as a place for legendary horses whose steps resound on the hills and mountains of the region.

Of course, there are no legendary horses in Si Ma Cai now, but visitors can hear the steps of horses pleasantly harmonize with the footsteps of ethnic peoples on the long trip from the hills and mountains to the village’s center market, particularly on Sunday.

The quiet Si Ma Cai turns bustling on Sunday as H’Mong, Dao and other ethnic peoples arrive from different directions for a hill-tribe market. There, they buy and sell meat, vegetables, fruit, clothes and other necessities of life as well as swap fun stories after a week of hard work.

The Si Ma Cai market remains distinct to its origins since locals sell what they harvest from the forest and business is just a matter for locals, not traders bringing items from Hanoi or elsewhere to sale there.
By SGT

Banks bank on property

The majority of commercial banks still rely on real estate as collateral assets for providing loans to small- and medium-sized enterprises.

The IFC, the World Bank’s private sector arm and the Vietnam Bankers’ Association, recently completed a survey of lending practices showing that 93 per cent of banks prefer property as collateral for commercial loans.
Most businesses assets, especially for small- and medium-sized enterprises (SMEs), are usually movable.
Sin Foong Wong, IFC’s country manager for Vietnam, said: “Better access to credit is crucial to achieve more widespread business growth in Vietnam, particularly for SMEs that now generate 60 per cent of GDP.
“Most of these firms cannot finance their operations through formal means because they cannot meet the collateral requirements of Vietnam’s financial institutions. Currently, Vietnamese banks rarely lend without property as collateral,” he said.
According to the survey, SMEs’ moveable assets which are worth billions of dollars, could be put to productive use and contribute to economic growth if businesses could use their assets to secure the financing they need to upgrade and expand.
To address this challenge the Ministry of Justice, with the IFC, Mekong Private Sector Development Facility (IFC-MPDF), together with the World Bank’s Foreign Investment Advisory Service (FIAS) has worked for the past year to improve the legal framework for asset based lending.
According to experts, as experience with other reforms shows, effective implementation was needed to maximise impact.
This includes computerising National Registration Agency operations for secured transactions and educating financial institutions about the reforms and how to profit from asset based lending.
Nguyen Thuy Hien, National Registration Agency director general for secured transactions (NRAST), said: “Vietnam needs to complement the legal reforms with an effective collateral registry. This will give financial institutions the quick and accurate information they need to make good lending decision.”
“Having this information available on an easy-to-access secure website will greatly enhance information flows, and make it easier for all parties involved,” she said.
NRAST is an institution under the Ministry of Justice, set up in 2001, with the objectives of undertaking administrative functions related to secured transactions (developing policy and a legal framework) and directly managing the operations of the registration agency for secured transactions, including leasing, sales with retention of ownership, and sales of the right to collect debts.
After nearly four years of operating, the NRAST has registered almost 15,000 secured transactions. Nearly 900 bank head offices and branches have registered as “regular clients” with the registry.
By VIR

Tourism: Tortoise’s In Town

Located in the heart of HCM City, the Tortoise Fountain is among the city’s well-known historical sites



Tortoise Fountain is the name of a square in central HCM City. It is located at the intersection of Pham Ngoc Thach, Vo Van Tan and Tran Cao Van streets, approximately 200 meters from the Notre Dame Cathedral.

The structure was originally built in 1879 and had gone through many alternations ever since. Initiated by the French, the 20-meter-high water tower was built in the center of the traffic circle. The water tank of steel with a capacity of 100 cubic meters was supported by eight pillars, placed in octagonal shape. The top of the tower was layered with tiles. The overall structure reflected the Pearl of the Far East design, which was the name of Saigon at the time, and can be seen on postcards dated in the late 19th century.

In 1921, the tower was destroyed. The reasons are unclear since all official and architectural documentations were lost. Records were not well kept at the time. They originally were in the possession of the Admiralty, then transferred to the General Governor’s Palace, to the Ministry of Public Works, and finally to the City Hall. It is likely that they were destroyed in transport or eaten away by moth in storage. The speculations for the abolition of the tower are either the structures were broken but repairs were unable to be made since the plans were lost or that the structures was too small to meet the demands of the citizens.

Once the tower was gone, the Council of Saigon City repaired the traffic circle and named it Marechal Joffre Square. In 1927, a Memorial to the 1914-1918 World War Dead was erected at the center of the square.

In 1972, the Vietnamese government rebuilt the intersection to commemorate allied countries that provided aid for the then South Vietnam. In the center of the fountain, stand five 20-meter-high upright pillars, reminiscence of five arms with five palms holding a globe. Beside the five pillars is a copper turtle. On its back was a stone stele which was engraved with the names of aiding countries. There was also a set of unique 30-step staircase, in which there is a resting platform after every 10 steps, on the south side of the fountain’s pool, leading up to an offering table for Heavens and Earth, which was five meters above ground level. Unlike the offering altar of Nam Giao in Hue, the table of the Tortoise Fountain in HCM City was neither round nor square but elliptical, with two axes being 12 and about seven meters long. The table was sustained by one main pillar and eight supporting pillars. On it, there was a one-meter-high altar, which faced the north.

When completed, it was not well received. Saigonese felt the five pillar hands turned upward as though to beg for aid. This was not believed to be a work of pride. Thus, the government transformed the five arms with five hands into a 25-petal flower. This became the structure seen today.

In early April of 1976, or 11 months after Saigon was liberated, an explosion took place at the traffic circle at 8 p.m., killing one young man and injured four others. The copper tortoise was damaged. According to HCM City Police, this incident was a political sabotage and the dead young man, himself, placed the dynamite on the tortoise.

Today, the tortoise no longer exists but the name Tortoise Fountain still remains. This site is particularly lively at night. It is surrounded by local coffee shops and street vendors. It has a reputation for great ice cream, especially coconut flavor. Around the lake, there are many age-old golden oak trees. They have fruits with two wings. When falling, these fruits twist and slowly land onto the ground. In the blooming seasons, these trees emit gentlefragrances throughout the area,creating poetical atmosphere for passers-by.
by TTM

Tourism news: Famtrip to India

Saigontourist Holding Co. is collaborating with its partners for the press trip from India to Vietnam. In the program, Indian reporters will visit different destinations in Vietnam, including HCM City.

India is now viewed as a potential market for the tourism industry, specifically from Saigontourist standpoint, which has launched many programs to promote the industry to India. The tourism conference named Vietnam an attractive destination for Indian tourists in New Delhi is the result of their efforts. It is well received and is much appreciated by Indian media and tourists.

Not only India, Saigontourist is also collaborating with many travel agencies to set up international programs to countries worldwide.

Martini Loungeinaugurated
Lion Restaurant has just opened its Martini Lounge inside the restaurant. The lounge is capable of accommodating up to 100 people. It has a balcony with airy atmosphere, a bar with buzzing jazz, and more.

Martini Lounge introduces to guests over 20 types of cocktails with special flavors. It also offers selections of snacks. The lounge opens from 5 p.m.-11 p.m. daily.
By SGT

Big Push For Stronger Banks

Banking regulators want stronger local banks to be able to stand the fiercer competition now that Vietnam has to open its economy as a WTO member


Vietnam is in the process of opening its finance-banking sector in line with its commitments to the World Trade Organization. At present, there are five State-owned commercial banks, one policy bank, one development bank and 37 commercial joint stock banks holding nearly 90% of the banking market share. However, except for a few strong banks, most of the commercial joint stock banks are not large by international standards, with their charter capital averaging VND500-1,000 billion (US$31.2-62.5 million).

HSBC, Standard Chartered, ANZ and Citigroup already have a presence but with the opening of the local banking market, more and more foreign banks, most of them established institutions with strong financial capacity and extensive experience, are keen to gain a good share of the local market.

Shrinking number

In an effort to help the local banking sector strengthen competitiveness, the State Bank of Vietnam, the central bank, is mulling regulations in step with the Government’s policy to restrict the establishment of new banks and encourage the merger of joint stock banks. “In the long term, the aim is to bring the number of domestic banks and financial groups down to 15 to 20 before 2010,” said a source from the central bank.

Kieu Huu Dung, director of the central bank’s bank department, expresses the idea this way: “When competition reaches a certain level, it will create pressure for mergers. At present, there is room for local commercial banks to grow in Vietnam, but merging may take place after five years more.”

To reach this target, the State Bank will implement policies regulated by the Basel Commission, which include high requirements for financial security, financial capacity, and experience in new banks’ big shareholders. The bank has just issued a decision on setting up new banks, which is seen as a new step to translate its plan into reality.

Under Decision 24/2007/QD-NHNN issued on June 7, the minimum charter capital required for a new bank will be periodically regulated by the Government. All commercial joint stock banks established between now and December 31, 2008, must have charter capital of at least VND1 trillion (US$62.5 million). Those coming into existence between December 31, 2008, and 2010 must have capital of at least VND3 trillion (US$187.5 million). A new commercial joint stock bank must have at least 100 shareholders, including at least three institutional founding shareholders.

The requirements for a founding shareholder do not make the role easy. If this shareholder is a non-bank enterprise, it must have equity capital of at least VND500 billion (US$31.2 million) and profitable operations in three consecutive years. If it is a bank, it must have total assets of at least VND10 trillion (nearly US$625 million), a bad debt ratio of less than 2% of total outstanding loans and profitable operations in three consecutive years.

The shareholders also face some restrictions in share ownership. An individual investor can hold at most 10% of the charter capital and an institutional investor at most 20%. In the first five years after the bank is established, founding shareholders can transfer their shares only among themselves. Meanwhile, non-founding shareholders cannot transfer their shares in the first three years. The shareholders must contribute capital with their own money, not with loans in any form.

The central bank’s intention to restrict the establishment of new banks is also a move to terminate the operation of ailing commercial banks. The collapse of any one of these may have a negative effect on the whole banking system. In the period of consolidating the operations of commercial joint stock banks from 1998-2001, the State Bank had to close 10 ailing banks, leaving 30 that have regained their vitality only over the past three years.

Stronger players

Despite the strict requirements of the new decision, more new commercial joint stock banks will likely come into existence this year. Dung says this is a strong trend at the moment. “Banks are doing well. So, the move to set up a bank is unavoidable,” he said. About 25 applications for setting up commercial joint stock banks have been received by the central bank.

Meanwhile, several strong corporations have plans to set up their own banks. Among their number are FPT, Bao Viet (Vietnam Insurance) Group, Postal Savings Company and PetroVietnam Finance. The central bank is cautious about this move. Central bank governor Le Duc Thuy early this year reminded the local media of the bitter outcome of events in the 1990s when many big businesses rushed to establish banks to raise funds for their operations and faced heavy losses.

At present, big State corporations are keen to establish banks or to hold a dominant role in a certain bank. According to Dung, this move is understandable, but it may lead to the corporations “manipulating” the banks when the corporations face some challenges. Therefore, the central bank has ruled that a corporation that is a member of the board of directors or a big shareholder of a bank cannot take out loans from that bank.

For these reasons, the Government is encouraging the merger of banks to establish bigger domestic institutions. To encourage bank mergers, the central bank will cooperate with the Finance Ministry to issue preferential tax policies for parties to a bank merger. The policies will appear next year. Along with this, the authorities will issue regulations to restrict the network expansion by banks which have capital below VND1 trillion this year. They will also adjust regulations on financial safety to meet international rules and create chances for the successful merger of banks.

According to a source from the central bank, strong backing will go to financial groups that combine insurance, banking and securities services. In 2006-2008, the Government will build one or two pilot financial groups by supporting a merger between a State-owned bank and Vietnam’s insurance giant Bao Viet. A law on financial groups will be adopted to replace the current law on credit institutions. The central bank will encourage financial groups to set up finance leasing companies to give a boost to the diversification of products and services on this market.

To help local banks boost their strength, Vietnam will give priority to foreign investors wishing to become strategic investors of local commercial joint stock banks. In a decree issued in April, the Government allows a strategic foreign investor to own a maximum stake equivalent to 15% of the charter capital of the local bank. Decree 69/2007 states that in particular cases, the Prime Minister may permit the strategic foreign investor to hold a stake equivalent to 20% of the capital. However, strategic foreign investors can transfer their shares only five years after their purchase.

On their part, a local bank that sell shares to foreign investors must also be a strong institution with charter capital of at least VND1 trillion (US$62.5 million), in addition to meeting other requirements on financial status, management and operations. Meanwhile, the foreign credit institutions buying shares of local commercial banks must have total assets of at least US$20 billion.

Aware of the need to become stronger players, many existing commercial joint stock banks are rushing to raise their charter capital to the level required, either by issuing shares or inviting the participation of local investors with strong financial capacity or foreign financial institutions. Some banks, like Vietnam Eximbank, have sold shares to strategic local partners such as Kinh Do Corp., Saigon Jewelry Co., PetroVietnam, Asia Commercial Bank and others. Others are selling part of their stakes to strong foreign banks. Among such deals are those between Orient Commercial Bank and BNP Paribas, Techcombank and HSBC, Habubank and Deutsche Bank, Southern Bank and United Overseas Bank, VP Bank and Overseas Chinese Banking Corp., Sacombank and ANZ Bank, and Asia Commercial Bank and three foreign partners–Standard Chartered, International Finance Corp. and Dragon Capital.

Vietnam will give priority to foreign financial institutions that become strategic investors of local banks. Therefore, foreign investors’ ownership in local banks may be allowed to increase from the present 30% to 49%. After 2010, the country will open up the financial sector in accordance with World Trade Organization commitments.
By SGT