Vietnam lacking ticketing staff for commercial airline industry

16:47' 25/07/2007 (GMT+7)

VietNamNet Bridge – A recent survey by the Air Service and Travel Company TransViet showed that Vietnam needed 400 more reservation and ticketing staff serving the commercial airline industry every year to meet the aviation growth rate of 20% per annum. A training course The survey has pointed out that Vietnam seriously lacks reservation and ticketing staffs for air travel, and this has made companies scramble for staffs, while the quality of the labour force is low. Mai Trung Thanh, Training Director of TransViet, said that the number of students trained for reservation and ticketing(booking tickets, issuing tickets, calculating airfares) remains very modest. In Vietnam, the Aviation Institute is the only place that trains labourers for this sector. However, the institute is located in the south of the country, and mainly serves Vietnam Airlines. The number of graduated students every year cannot meet the demand of the market. There are 520 travel agents in Hanoi and HCM City, and 40 international airlines which have offices in Vietnam. Mr Thanh said the survey showed that 70% of agents have only a half of trained staffs, while the other staffs learn right at work. Vietnam Airlines has its own programme on training booking employees with 4 training courses every year (920-25 trainees every course). However, the trainees are just enough for Vietnam Airlines only. The air carrier only provides free training to 1-2 persons for every booking agent, while others have to pay the fee of VND6mil ($375) for the course. TransViet, which acts as the general agent for big airlines, like United Airlines (US), British Airways, All Nippon Airways (Japan), also trains staffs itself: senior staffs show juniors the things they have to do. The serious lack of reservation and ticketing staffs has forced air carriers to scramble for staffs. The carriers have to offer higher pay in order to lure staffs from other airlines. “All airlines try to attract staffs by offering high salaries when they enter Vietnam,” said Mr Thanh. The biggest problem with the scrambling is the bad quality of ticketing staffs, because the regular shift of working places does not give enough time to staffs to get experience. According to Mr Thanh, the number of contracts Vietnamese booking officials can cover a year is just a half of the contracts covered by Thai and 1/3 of Singaporean officials. The Head of United Airlines’ Representative Office in Vietnam, Joe Mannix, said frankly that the general capability of ticketing staffs in Vietnam was okay, but they still did not have deep understanding about their work. Meanwhile, Vietnamese staffs do not have deep knowledge about international standards. He said that the skill that was most necessary for ticketing staffs was English speaking. Moreover, Vietnamese staffs should become more active and take initiative in their works. Pham Thi Thuy, Director of the Training Centre under the Aviation Institute, said that students now had to go to HCM City to be trained, and most of them stayed in the city after the training; therefore, northern airlines are still seriously lacking staffs. The biggest problem in training ticketing staffs is the lack of practice-fostering environments. Moreover, it takes $4,000 on average to send a teacher abroad to follow training courses and get the certificate from the International Air Transport Association (IATA). Nguyen Hai, Chairman and Director General of TransViet, said that TransViet would join forces with Amadeus and United Airlines to launch a 3-month training course for booking employees. Mr Hai also revealed that TransViet would provide courses for tour operators and air agents, hoping to provide qualified staffs for the airlines operating in Vietnam. Ha Yen, Viet Nam Net

Hanoi’s first private studio to work on sitcom

10:22' 25/07/2007 (GMT+7)

Director Do Thanh Hai VietNamNet Bridge - Mesa’s studio, the first studio in Hanoi to be owned by a private entity, is being completed to welcome the film team of a 300-episode foreign-type sitcom titled Merry Apartment this September. According to director Do Thanh Hai, who will be in charge of Merry Apartment, unlike another new film studio to be built in the My Dinh area by Vietnam TV Film Production Company, Mesa’s studio was designed especially for the sitcom’s film team to work there for the next three years at least. Mesa’s studio is situated on an area of 1,000 sq.m in the neighbouring province of Hung Yen, about one hour’s drive from Hanoi. Mesa’s studio has other facilities besides its studio such as office, production and logistics areas to ensure a self-contained system. As for Merry Apartment, it is an ambitious multi-episode TV comedy of the sitcom type which Vietnamese filmmakers have been exploring in recent years. It is based on a Chinese series and will cast familiar comedians in both the north and south like Quang Thang, Van Dung, Hong Van and Bao Quoc. Director Hai said this Chinese sitcom, which is about intricate human relationships and contact within a modern apartment, was a little bit different from western sitcoms such as the popular American show Friends, which has been broadcast on Vietnamese TV. “Western sitcoms don’t have to reflect real life too faithfully so they are freer to explore situations to make audiences laugh. Chinese sitcoms, on the other hand, are more or less influenced by eastern values. “Their dialogues are thus more subdued. Instead of directly tickling people with dialogues, they bring about laughter by the clashes among different characters,” said Mr. Hai. (Source: Tuoi Tre, Viet Nam Net)

Nguyen Tan Dung re-elected as Prime Minister

16:50' 25/07/2007 (GMT+7)

VietNamNet Bridge – Prime Minister Nguyen Tan Dung was re-elected to his post in a landslide vote that saw 96.96 percent of National Assembly (NA) deputies call on the PM to embark on a new term, in Hanoi on July 25. Nguyen Tan Dung, born 1949, was elected as Prime Minister at the 11th National Assembly's mid-term (June 2006) and is the youngest person to head the cabinet over the last two decades. At the morning session, the NA deputies elected Nguyen Thi Doan as Vice State President; Truong Hoa Binh as Chief Judge of the Supreme People's Court; and Tran Quoc Vuong as Director of the Supreme People's Procuracy. They also discussed the personnel of the NA's Council of Ethnic Minorities and other Committees and the Secretariat in charge of NA sessions. - The Council of Ethnic Minorities is to be comprised of 39 members, including five full-time Vice Chairpersons and three Vice Chairpersons. - The Law Committee will be made up of 34 members of whom four are Vice Chairmen. - The Judicial Committee will consist of 34 members, including four Vice Chairmen. - The Economic Committee is to have 36 members, including four Vice Chairpersons. - The Financial and Budgetary Committee will include 35 members, of whom four will be selected to act as Vice Chairmen. - The Defence and Security Committee is to have 34 members, including two Vice Chairpersons. - The Committee for Culture, Education, Youth and Children is to consist of 39 members, including four Vice Chairpersons. -The Committee for Social Affairs is to be composed of 40 members, including four Vice Chairpersons. - The Committee for Science, Technology and Environment is to have 37 members, of whom three are Vice Chairpersons. - The Committee for External Affairs will include 30 members, including three Vice Chairpersons; and the Secretariat for NA session is to have 13 members. The NA is set to vote on these issues on July 26. (Source: VNA, Viet Nam Net)

VND/US$ exchange rate stable until year-end: reports

16:56' 25/07/2007 (GMT+7)

VietNamNet Bridge – Big international institutions all share the same view that the VND/US$ exchange rate will keep stable in the last part of the year as in the previous three years. The strong flow of foreign capital into Vietnam over the last time has put pressure on the local currency, forcing the VND to revaluate. However, the fact that the State Bank of Vietnam is trying to buy more foreign currencies has helped stabilise the exchange rate. According to Citibank, in 2004-2006, the VND lost 0.8-0.9% in value every year. However, the local currency unexpectedly revaluated in the first two months of 2007. The revaluation of the local currency halted in subsequent months; however, the local currency has revaluated again in the last three months, by 0.6% against the greenback. The current exchange rate is VND16,138/US$1, which is lower than the rate seen in January 2007 (VND16,142/US$1), but higher than the VND16,060/US$1 level in mid February 2007. The fact that the central bank bought dollars in large quantity in the last time has helped reduce the supply of foreign currencies on the market. This is considered the main reason that the greenback has recovered. The central bank has confirmed that it will continue buying foreign currencies in order to raise the foreign currency reserve and ensure the devaluation of the VND of 1% in 2007 as previously targeted. Therefore, the reports by Citibank, HSBC, Standard Chartered all said that the VND would slightly devaluate in the short term. However, as the surplus in international payment balance remains high thanks to the big capital inflow (foreign direct investment FDI), overseas remittance and portfolio investment, this will maintain the pressure on the local currency. Experts have voiced their concern about the increased supply of money on the market as the central bank is trying to buy more foreign currencies. In fact, in order to buy a big volume of foreign currencies, the central bank will have to put a big volume of VND into circulation, thus making it more difficult to realise the goal of curbing inflation. In fact, international financial institutions, including the World Bank (WB) and International Monetary Fund (IMF), warned about the impact of the foreign capital flow on the monetary policy management earlier this year. WB even said that the investment flow would challenge the monetary policy. It seems that the central bank has to do two works that may conflict with each other: putting more money into circulation to buy foreign currencies for reserve, while tightening the monetary policy to curb inflation. Therefore, every solution should be considered thoroughly to ensure reaching both purposes. Most recently, the central bank has decided to raise the compulsory reserve ratio to 10% for bank deposits, a move aiming to tighten the monetary policy and withdraw money from circulation. However, the effects of the decision will only be clear in some months. (Source: DTCK, Viet Nam Net)

Lending interest rates up, banks and businesses feeling down

10:29' 25/07/2007 (GMT+7)

VietNamNet Bridge – Enterprises are now weeping because they have to pay more on their bank loans, while banks also feel unhappy because they have to raise the interest rates while they do not want to. As the central bank has required a higher ratio of compulsory reserve for both VND and US$ deposits (10%), commercial banks have to raise the lending interest rates to have more usable capital. Except for the Industrial and Commercial Bank (Incombank) system, which retains the interest rates it has been applying since the end of last year, other banks all have raised their lending rates. In Hanoi, the average lending interest rate is 14.4% per annum (+ 2.04% per annum) for short-term loans, while the rates are 14.4% per annum (+ 1.35% per annum) for medium-term loans, and 15% (+ 0.6% per annum) for long-term loans. Where to get money to pay interest on bank loans? Deputy Director General of a Dong Nai-based state owned corporation said that with such high interest rates banks could only loan to big corporations which could budget for paying debts from different sources, while small projects and businesses dared not borrow money from banks. In fact, with the interest rate of 12% per annum and higher for medium- and long-term loans, many enterprises venture to borrow money while they still do not know where to get money to pay interest on the bank loans. “The enterprises that operate under the market mechanism, joint stock and private companies cannot bear such high interest rates. If enterprises borrow money for 9-10 years, the interest they have to pay will be equivalent to the original loans,” chief accountant of an enterprise said. She added: “I heard that a bank lends at 16.2% per annum. I think you can pay the interest only if you trade forbidden goods.” When hearing that banks planned to raise the interest rates, enterprises said they would not accept the new interest rates, saying that they had drawn up business plans based on the previously applied interest rates, and that any interest rate adjustment would make them lose money. Higher interest rates: enterprises dead, banks deceased An expert related that the director of a transaction centre of a state owned bank decided to raise the lending interest rate right after the central bank announced the new required compulsory ratio. The director feared that the transaction centre would not fulfill the targeted profit plan if the margin between the input and output interest rates was too low. However, two months after applying the new interest rates, his staffs asked him to lower the interest rates, saying that clients had left for other joint stock banks offering ‘softer’ interest rates. The expert said that several big branches of Vietcombank had asked headquarters not to raise the interest rates in order to create favourable conditions for clients to maintain production and business. Which solution? The solution that commercial banks thought of when the central bank set a higher requirement on compulsory reserve ratio was to raise the lending interest rates. However, the move proved to be not the optimal solution. Higher interest rates have made businesses and households delay their projects and spending plans. As a result, banks cannot expand their markets, while enterprises are becoming less competitive. What banks can do now is to seek profit from other activities rather than relying on credit, including investment and non-credit services, while trying to seek cheap-capital sources. This will help ensure the stable income of banks and there will be no need to put a heavy burden on enterprises. Nguyen Dong Tien, Deputy Governor of the State Bank of Vietnam, said that the central bank would not adjust the recapitalisation, discount interest rates and the basic interest rate in the immediate time, in order to help commercial banks draw up suitable policies beneficial to both banks and the national economy. The lending interest rates offered by commercial banks in mid July 2007: Short-term VND loans: 9.84-13.8% per annum Medium- and long-term VND loans: 11.4-16.2% per annum Short-term $ loans: 5.7-6.7% per annum Medium- and long-term $ loans: 6-7.8% per annum Though members of the Vietnam Banking Association agreed on April 2007 to lower the VND deposit interest rates, the actual rates offered by banks are higher than the agreed levels, 0.03-0.04%/month higher for state-owned banks, and 0.02-0.12%/month higher for joint stock banks (Source: Lao dong, Viet Nam Net)