By Asia News Network
South Korea’s SK Group is investing $1 billion (Bt32.5 billion) in Vietnam’s largest privately-owned group, the Vingroup Joint Stock Company, adding momentum to its business expansion in the Southeast Asian country, company officials said.
South Korea’s third-largest conglomerate signed a deal in Hanoi to acquire 6.1 per cent of the Vietnamese group’s shares at $1 billion (Bt32.5 billion), making it the largest shareholder. The transaction has yet to be confirmed, pending the customary regulatory approval by local officials.
The two counterparts also agreed to jointly invest in efforts to privatise Vietnam’s state-owned firms in the upcoming years.
To follow up on the newly sealed partnership, SK Group will be appointing an executive member to join Vingroup’s directorate, officials said.
The strategic investment on the part of the Korean conglomerate was a demonstration of trust in its Vietnamese partner, as well as an endorsement of both parties’ confidence in the growth potential of the Vietnamese market, officials said. – The Korea Herald
Philippine central bank may again cut rates
The Bangko Sentral ng Pilipinas, the Philippines’ central bank, is expected to further cut interest rates on top of an additional reduction in bank reserves amid easing inflation and slowing growth.
The three-phased cut in the reserve requirement ratio (RRR) of universal and commercial banks approved by the BSP’s Monetary Board last week “should provide a boost to economic growth and suggests that further cuts to the policy rate are likely soon,” Capital Economics senior Asia economist Gareth Leather and Asia economist Alex Holmes said in a report titled “Philippines loosens further, Pakistan back to the IMF”.
The RRR reduction to 16 per cent from 18 per cent at present will be implemented in three stages—an initial 100-basis point cut on May 31, followed by 50 bps each on June 28 and July 26.
For London-based Capital Economics, the move was in response to a sharp slowdown in both credit and money supply growth.
“The RRR cut should put downward pressure on interbank rates, which have been trading at the top of the BSP’s interest rate corridor since around the start of the year.
“The central bank has estimated that the cut to the RRR should release around 190 billion pesos of extra liquidity into the banking system, which we estimate will boost credit growth by up to three percentage points,” it said. – Philippine Daily Inquirer
Indian giant offers to build IT centre in HCM City
The Hindustan Computers Limited (HCL) from India plans to establish an information and technology (IT) centre in Ho Chi Minh City, which will provide training for about 10,000 IT engineers over the next five years.
HCL executive vice president Sanja Gupta revealed the plan during a meeting with the city’s leaders last week, saying the southern economic hub had favourable conditions to develop his company’s project.
He also spoke highly of the IT labour force in Vietnam, describing it as an important factor to ensuring the success of IT services in the future.
A full report on the plan to build the centre in HCM City would be submitted to HCL senior leaders for approval this July. Once approved, work on the IT centre would begin in the fourth quarter of this year, he said.
For his part, the municipal People’s Committee vice chairman Tran Vinh Tuyen said the corporation’s development strategy was in line with the city’s potential and development roadmap.
The city pledged to fully implement preferential policies for foreign investors, including those operating in the IT sector, he said. – Viet Nam News
Johor seeks China firms affected by trade war
Malaysian state Johor stands to gain from the ongoing US-China trade war by luring Chinese manufacturers that will be badly affected by it.
State International Trade, Investment and Utility Committee chairman Jimmy Puah Wee Tse said he would be part of a business delegation, organised by the Johor Baru Chinese Chamber of Commerce and Industry (JBCCI), to Guangzhou on May 27.
He added that this was a very special trip which JBCCI has been planning since January this year. – The Star