Thứ Năm, 31 tháng 7, 2014

Cornell Study Finds LEED Certification Boosts Hotel Revenue

A new study from Cornell University has found

that hotels gain a revenue benefit when they are certified under

the LEED sustainable building program.


By comparing LEED certified

hotels with a competitive set of non-certified hotels, the study

found substantial increases in ADR and RevPAR for the LEED hotels.


The study, “The Impact of LEED

Certification on Hotel Performance” by Matthew Walsman, Rohit Verma, and Suresh Muthulingam,

is available at no charge from the Cornell Center for Hospitality

Research (CHR) at the School of Hotel Administration.


“The hotel industry has embraced environmental

sustainability and several hotels have registered for or earned

“green” certification under the LEED program,” said Verma, who is

the Singapore Tourism Board Distinguished Professor at the School

of Hotel Administration. “But LEED, which stands for Leadership in

Energy and Environmental Design, is really aimed at controlling costs by limiting resource use. So, the question was whether there

also is a revenue benefit from LEED. We found that the answer is,

absolutely yes.”


The study compared the performance 93

LEED-certified U.S. hotels (the number for which operating data

were available) to that of 514 comparable competitors, and found

that the certified hotels obtained superior financial performance.

The authors completed this report by analyzing comprehensive hotel

performance data provided by STR, a Partner of the Center for

Hospitality Research.


Walsman, a doctoral candidate in Service

Operations Management at the School of Hotel Administration,

pointed out that many of the hotels had only recently been

certified, so the study could compare their revenue experience for

a period of just two years.


“We’ll have many more hotels to study

in the future,” he said, “since companies like Marriott have now

included LEED as part of their own design specifications for new

constructions.”


The researchers found that the revenue

benefit applied in hotels of all types, although most hotels in

the study were upscale or luxury properties located in urban or

suburban locations.


“This makes sense, because many of the LEED

standards involve a hotel’s connection to public transit or other

resources typical of urban areas,” Verma added.


Developed

by the United States Green Building Council in 2000, the LEED

certification process gives commercial buildings a scorecard for

meeting standards relating to such areas as location and

transportation, materials and resources, and water efficiency,

among others. The more points under the program, the higher the

certification level. Although the initial LEED standards were not

directly aimed at hotels, numerous hotel properties nevertheless

have earned certification. The most recent version of the LEED

standards specifically include hotels, along with other commercial

buildings.


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Cornell Study Finds LEED Certification Boosts Hotel Revenue

SQ hits fiscal turbulence

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SINGAPORE, 31 July 2014: Singapore Airlines (said Wednesday its financial first quarter net profit plunged 71.4 % from the previous year, weighed down by lower passenger and cargo revenue.


Net profit in the three months to June came in at SGD34.8 million (USD27.8 million), down from SGD121.8 million in the same period last year, the national flag-carrier said in a statement.


Group revenue fell 4.1% SGD3.68 billion.


“Passenger revenue declined year-on-year on the back of weaker yields amid intense competition, and unforeseen events that depressed travel demand in some key Asian markets,” it said.


The airline said revenue from its freight arm SIA Cargo also fell “as the airfreight market continued to be affected by excess capacity”.


It added that losses from associated companies, in particular budget carrier Tiger Airways, contributed to the decline in net profit.


“The outlook for the air transportation industry has become more challenging with continuing uncertain global economic climate, geo-political concerns in the region and elevated fuel prices,” it said.


“Aggressive fares and capacity injections from competitors will continue to place pressure on yields,” it added.


SIA has faced stiff competition from Middle Eastern and Asian carriers, as well as Asia’s growing ranks of budget airlines.


The airline said it is “targeting specific product segments and traffic lanes” to boost the performance of SIA Cargo.


“Overcapacity in the market will continue to impact the cargo business, notwithstanding a slow recovery in demand,” it said.


The freight arm currently operates a fleet of eight Boeing 747-400s, while the parent airline runs 103 passenger aircraft including 19 Airbus A380 superjumbo jets.


SIA did not specify what unforeseen events had caused a drop-off in passenger revenue in certain markets.


But the mysterious disappearance of Malaysia Airlines Flight MH370, 8 March, while on a flight from Kuala Lumpur to Beijing has hurt the arrival of Chinese tourists to Malaysia and Singapore.


Official data from Singapore’s tourism board showed a 27% decline in passenger arrivals from China in the five months to May, compared to the same period in 2013.


Tourism experts have said Chinese visitors are staying away from Malaysia due to a deep-set cultural aversion for anything associated with death, which would in turn affect arrivals to neighbouring Singapore.


Chinese tourists usually visit both countries as part of large tour groups.


© 1994-2014 Agence France-Presse




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SQ hits fiscal turbulence

MPA: Drop in major incidents in Singapore waters, but safety still important

SINGAPORE – The number of major incidents in Singapore’s waters has fallen over the years but safety standards must be maintained as more vessels are calling here, the Maritime and Port Authority of Singapore (MPA) said on Thursday.


There were six major incidents in waters here last year, down from eight such incidents in 2012 and 13 in 2011. Major incidents include those where there were loss of lives, ferry or passenger ship mishaps, and oil or chemicals spills that required multiple agencies to clean up.


This drop contrasts against the sharp increase in vessel arrivals here in 2013: the annual vessel arrival tonnage was a record 2.33 billion gross tonnes last year.


The MPA shared these figures at the launch of its inaugural Safety@Sea campaign yesterday, where it aims to raise awareness of safe practices and inculcate a safety-first culture at sea.



MPA: Drop in major incidents in Singapore waters, but safety still important

MakeMyTrip Limited"s (MMYT) CEO Rajesh Magow on Q1 2015 Results ...

Question-and-Answer Session


Operator


[Operator Instructions] And your first question comes from the line of Lloyd Walmsley with Deutsche Bank.


Lloyd Walmsley – Deutsche Bank AG, Research Division


Wondering if you can just elaborate a bit more on the strength in the HP segment. How much of that was contribution from EasyToBook? And then what are some of the other core factors driving your bookings growth there? It sounded like, I think, you said something to the effect of some better competitive pricing on outbound. If you could kind of, I guess, explain if that may have been part of that take rate moving slightly down, but I guess incorporating that into perhaps the booking strength.


Rajesh Magow


Sure, Lloyd. This is Rajesh. Let me take this. So the first question was how much is it coming from EasyToBook and how much is the growth from the existing business. So the simple answer is, as you know, that we’ve been reporting consolidated financials, but the growth — last part of the growth, actually, came from India business. And the EasyToBook number, although, it is part of the consolidated financial, but it wasn’t a material number. And in the India business, all key segments standalone hotels, holidays, even air business specifically as highlighted in the script earlier, international Air ex India, where there has always been a lot more headroom. All of these segments grew and also some part of the growth kind of came back on domestic air as well. As far as on the outbound side, I guess, can you just repeat your second part of your question?


Lloyd Walmsley – Deutsche Bank AG, Research Division


Yes, I mean, it looked like the take rate in the HP business declined slightly. Was that in part due to some discounting or aggressive pricing on outbound? I think, you all had mentioned in the script.


Rajesh Magow


Yes, no, it’s a great observation, but it’s just a very small, small number. And as you would go back in history and analyze, typically, in the high season quarter, there would always be a little bit of a trade-off on transaction growth that you would — one would do it tactically. But in terms of just from a trend perspective, more on a full year basis, whatever we’ve been talking about, historically, just to kind of incrementally improve the overall HP margin on a full year basis, we think we are on track to do that. So I don’t think there is anything to kind of get concerned about that at all.


Mohit Kabra


Also Lloyd just to add to what Rajesh has mentioned, typically in the high season travel quarter, our holiday season quarter, because of the increased mix of packages, which is typically adding a lower margin on account of transport mix. The overall HP margin tends to be slightly softer than the off season quarters.


Lloyd Walmsley – Deutsche Bank AG, Research Division


Yes, it looked like last year was your strongest quarter but…


Rajesh Magow


Yes, Lloyd. No, so I would like to just clarify on that. You’re right. I mean, last year it was like 12.9% same quarter. But last year if you would remember it was also a bit of a slowdown. And so during the slowdown period, it kind of changes and typically you will have high margin and less transaction growth. And also the mix was strongly in favor of more hotels because leisure business is what it kind of take because, relatively speaking — but I — as we’ve been talking about in the past as well and when it comes to analyzing the overall margins, I think, we should perhaps be more full year picture rather than just a quarter-on-quarter picture, because there would be tactical moves within a particular quarter for one reason or the other, which we’ve done it historically. We would continue to kind of do it, because that’s important. Again, more like technical moves, but as we growing our web — we continue to grow our volumes, as you can see on the HP segment, we definitely think that we will continue to keep improving our margin on an overall basis portfolio.


Lloyd Walmsley – Deutsche Bank AG, Research Division


Yes, okay. That’s one, and another if I may. Granted it’s early in your fiscal year, but the first quarter is really strong and the guidance implies slower growth in the remainder of the year. Is there anything in particular that you see that could slow things down or is it just a general conservatism in wanting to really not get ahead of yourself?


Rajesh Magow


Yes, I think it’s more the latter, Lloyd. There has been, of course, a big turnaround on the political side. We have a government with a single large majority. So there are signals all around. I think on the air side, as we know, it takes a little longer and it takes some time for them to play out. We’ve finally see the launch of AirAsia, something we’ve been hearing and talking about for a long time. Tata-Singapore Airlines on the annual, but it takes time. At the same point of time, some of the incumbent airlines are still under duress, not in the best of financial health. So I think, it takes a little — it will take a little bit more time there. We would be very bullish about and what we are actually confident in seeing month-on-month more growth is actually new users coming to mobile, and that’s the positive development. In fact, to the earlier point also, there’s a good deal of, as you noticed, standalone hotel transaction through mobile, which has crossed 25%. And there are some amount of incentives being given through that channel to get some of the new users out there. So I think, on HP, there are very positive signs. On air situation, I think, it’s getting better. But I wouldn’t say that the air industry or the air ecosystem is completely out of the woods yet.


Operator


And your next question comes from the line of Manish Hemrajani with Oppenheimer.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Strong hotel numbers, I know that there’s been talk about a lot, but can you touch upon the #1 factor that’s driving transaction growth in hotels? And what’s the median ticket size for hotels currently?


Rajesh Magow


Manish, thanks. This is Rajesh here. So it’s actually a combination of factors quite frankly. Fundamentally, as you know, that the standalone hotels market has been fairly under penetrated, and therefore, from our push perspective, we’ve been trying to actually cover this space 360 degrees. From supplier to user interface to just improving the content, and also a lot more actually push is coming from mobile as well. As you can notice, I mean, if there is any — between air and hotel, actually lot more transactions are coming in on the mobile platform from a percentage of total business perspective through mobile platform as well. So that’s kind of contributing as well. So bunch of factors. But if you look at overall Hotel and Packages together, the season was a good season quarter for even the domestic holiday [indiscernible] as well as outbound holiday as well. And if you compare it with the last year, same quarter, there has been lot more concern about the currency movement, and therefore, long-haul bookings kind of were getting impacted because it’s becoming a lot more expensive. And there has not been that much fluctuation on the currency of late. So that kind of helps as well. So I won’t say there is one single factor that drove this. These are some of the factors that kind of helped the growth overall.


Deep Kalra


Manish, just answering your question on the average ticket size. The average ticket size on the hotel site, has been increasing both quarter-on-quarter and also year-on-year. So that your seeing an improving trend as far as average ticket sales is concern. And more so because of the improving mix of international hotels in the overall hotel bookings.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Okay, you mentioned that you had 184,000 total properties, right, in your network. How many were domestic?


Mohit Kabra


No, no. So the domestic number is actually 13,000, Manish, up from…


Mohit Kabra


13,000, 1-3, up from 11,400.


Mohit Kabra


84,000 is in international hotel now.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Right. So in terms of bookings, what would your mix between international and domestic for hotels for HP?


Mohit Kabra


As far as bookings are concerned, both domestic as well as international bookings kind of now contribute almost equally, particularly in the peak season quarter. So it’s kind of directionally moving well on those lines. And particularly as Rajesh was mentioning during the call, the large part of the growth is kind of coming in from international segment, whether Indian air versus international air, which is kind of ex-India, which is kind of growing the fastest. And similarly, international hotel bookings is the other segment, which is kind of growing the fastest as well.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Okay. And then on your conversion rates, how do your conversion rates on the mobile platform compare with the desktop?


Deep Kalra


So, fairly comparable actually, Manish. When it comes to hotel booking specifically. And we have some ground to cover when it comes to the air bookings and we are kind of working on that. But on the hotel side, fairly comparable.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Got it. And on the mobile front given where we are in very early stages in terms of penetration levels, what are the technological investments that you’re making at the back end to see that up again?


Deep Kalra


Maybe I can just take that, yes, Manish. So Manish, in India, as you know, there is a very large proportion of independent. Most of these hotels are not actually using sophisticated systems as one would imagine. So a lot of investment has gone in actually getting the hotels to work either directly through our extranet or for our extranet to actually talk to the channel managers, which have now become quite popular among the domestic hotels. So we have been working quite hard on that side. So on the mobile point of view, also, just averaging the whole mobile opportunity like you were saying, we now are working on solutions where the smaller hotels can actually move directly onto a mobile platform. We have seen a very typical use case of hotel owners, managers, not really being on large phones and managing a lot of their inventory and the kind of booking profile ahead through the phones and that’s where we are — we have efforts which are going on, they’re underway. And we think that’s going to help us significantly as well. I think in the next couple of quarters, we’ll see a significant shift of people just working on the solution. They can still work on the solution for the mobile, but it’s not really built for a mobile first solution as of now, but there’s work going on there.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


Got it. One last one for me on the take rates. Take rates down on air, as well as hotels. Hotel is down 11.9%, take rates on air were 5.8%. Is there some user discounting that you guys are undertaking to drive volume growth here, which has impacted take rates?


Rajesh Magow


Not particularly very high on discounting. But the difference is not yet year-on-year compared it — when you compare, it’s a drop, probably a material drop. But I would rather compare this quarter-on-quarter where it’s almost flattish. And except for mobile, where for early adoption you would do some tactical discounting and stuff like that. That is all — aiming during the high season when you have kind of momentum on the growth of transactions, you would like to probably be a little more invested on pricing, very tactically. And nothing beyond that. So this has nothing to do in terms of production coming in from suppliers into it or from the contracting side, this is just in the high season quarter where the transaction growth was pretty high, you would just make some technical moves, but I won’t lean particularly too much into it that this trend is going to continue. From a trend perspective on a full year basis, I think we should be able to make the incremental improvement from last year.


Manish Hemrajani – Oppenheimer Co. Inc., Research Division


So then how should we look at directionally for both air and hotels, up from here? Is that what you’re suggesting?


Rajesh Magow


Yes, so Manish as we’ve been talking about within the parts of our air. From a long-term perspective, we’ve always been saying that it will settle at some point in time between 5% and 5.5% and as it’s going towards that. And as far as HP is concerned, last year we did about 12%, and we will see some improvement given our volumes are growing on a full year basis. Like incremental improvement maybe half a percentage points or something. So that’s how we should think about that.


Operator


And your next question comes from the line of Gaurav M with Citigroup.


Gaurav A. Malhotra – Citigroup Inc, Research Division


Good set of numbers, just had 3 key questions. Firstly on Air Ticketing. Now that is a trend, obviously, as Rajesh said, would the net margins would be trending down, but are the margins falling faster than what the expectations have been in the, say, last 6, 9, 12 months. That’s one. Secondly, on Hotels and Packages, this quarter if I understood correctly, the proportion of packages was higher because of its — the net margins went down by 20 bps quarter-on-quarter. Is that correct? And would we expect the margins to move backup, say, between 12% to 13% range in the next 2 or 3 quarters? That’s the second question. And the last question is just on the share-based compensation, how should we look at it for the full FY ’15?


Mohit Kabra


Gaurav, I’ll take that. On the air margin, if you look at it, air margins are kind of comparable in line with seasonality. So year-on-year they’re kind of comparable to what is reported in the same quarter of last year. And that typically tends to happen because in peak season, the air fares continue to remain high and because of this semi-variability of the air margins. It tend to kind of be on the lower side during peak travel quarters or high season quarters. Moving on to your next one, this is in terms of the HP margins. Year-on-year, HP margins, our sales represent and I did announce that earlier also. Again, in the peak season quarter, there tends to be a higher mix of packages within the overall HP segment. And therefore, you’ll see a little bit of softness in the overall HP margin. And this could kind of vary in between season lean and peak season quarter. And as Rajesh was pointing it out, overall for the full year, it would be kind of — we still believe that we’ll be able to kind of see small improvement in the overall take rate for the HP business over last full fiscal and this full fiscal.


Deep Kalra


Coming to your third one on the employee share-based compensation cost. We have kind of guided at about the share-based compensation cost remaining in around the range of about 2% of outstanding shares. And even in the current quarter, the share-based compensation cost is close to about $2.6 million. And that is what could be kind of taken as a fair number close to that $2.5 million to $3 million is what we should have in the coming quarters as well.


Gaurav A. Malhotra – Citigroup Inc, Research Division


Okay, just one follow-up question on Air Ticketing, if you could just explain perhaps as to why in the peak season there is a softness. That’s one. And secondly, are we seeing that in the next couple of quarters you will see the margin sort of going up to an extent?


Mohit Kabra


See what it mean in terms of slight compression in the margin percentage, in peak season is because you are — the overall asset tends to kind of be higher during the higher season quarter and when it comes to margin, there’s certain amount of — certain elements within the overall margin, which are more like value-based number and not really a percentage basis. So since there is a slight fee typically in case of service fee or consumer or convenience fee, there tends to show a slight downward trend when the layer are high. We’ve yet to see how does the air fare trend be going forward, we believe there could be certain amount of softness, at least in the lean season quarters during the year. In which case, we might see small improvements coming through in the air margins as well. But slightly early to call that out. But as we’ve been saying, we do believe during this year, the air margins will be more around the 6% mark, and it would kind of will vary by about 0.25 to 0.50 percentage point between quarter-on-quarter.


Operator


And your next question comes from the line of Pinku Pappan with Nomura.


Ashwin Mehta – Nomura Securities Co. Ltd., Research Division


This is Ashwin, instead of Pinku. I had one question in terms of our personnel costs, which saw almost 20% sequential jump in this quarter ex of the severance costs as well. So where exactly are these investments being made and how do you look at this cost item going forward? And secondly, I wanted to get a sense in terms of what our overall headcount was.


Mohit Kabra


Ashwin, the sequential cost, I mean, quarter-on-quarter more up in the range of about 12-odd percent, excluding [indiscernible]. And of that 12-odd percent, large part of it comes in largely on account of the annual wage increase that gets rolled out in April. So it’s largely on account of that.


Ashwin Mehta – Nomura Securities Co. Ltd., Research Division


And what was our headcount as of this quarter?


Mohit Kabra


Headcount movement hasn’t been kind of very different. Overall, we stay kind of larger on the same headcount number as in the last 1,300. It’s close to about 1,300.


Operator


And your next question comes from the line of Chad Bartley with Pacific Crest.


Chad Bartley – Pacific Crest Securities, Inc., Research Division


To your revenue guidance is helpful and I was hoping you could provide some comments on how you’re managing profitability this year, even with a higher investments in mobile, which makes sense. For example; can you still achieve positive adjusted operating income? Or should we expect losses this fiscal year?


Mohit Kabra


We have been kind of mentioning that in line with what we’ve been saying focus largely remains on kind of driving growth, both in transactions as well as revenues. And at least there is a good possibility of us being able to closer to breakeven for the full fiscal, particularly having seen profitability return in the high season Q1. So depending upon how the air trend prevails in the forthcoming lean quarter and in the next quarter or 2, I think we’ll have greater clarity on that. But it looks like they’re kind of getting better clearly year-on-year and quarter-on-quarter when it comes to getting the business back on profitability.


Operator


And at this time, we have no further questions. [Operator Instructions] And at this time, we have no questions.


Deep Kalra


Thank you, everyone, for joining our first fiscal 2015 first quarter earnings call. We look forward to speaking with you on next quarter.


Rajesh Magow


Yes, thanks.


Mohit Kabra


Thanks, everyone. Thank you.


Operator


Ladies and gentlemen, that concludes today’s conference. Thank you for your participation. You may now disconnect, and have a great day.



MakeMyTrip Limited"s (MMYT) CEO Rajesh Magow on Q1 2015 Results ...

China"s 10 Favorite Countries For Real Estate

Real estate agents with million dollar listings in New York, Miami and Los Angeles all have one thing in common: Chinese clients.


The cities are the top spots in the U.S. for wealthy Chinese house hunters looking for third homes abroad. And when it comes to individual nations, the U.S. tops the list of global real estate hot spots. According to Chinese real estate portal Juwai.com, the U.S. remains the lead destination for Chinese investors, many of whom are hamstrung in their home country from buying second or third homes. Authorities in the country have made second home real estate transactions costly, increasing taxes and down payments. Third homes are out of the question for individuals, who often have to form limited liability companies and buy under a different name. The same often holds for China buyers in the U.S., who are acquiring homes sometimes sight-unseen after reading about the listing on Juwai.


California is the top spot for Chinese house hunters. Los Angeles, seen here, is becoming a go-to real estate market now that the city is seeing investments in new, luxury, urban, mixed-use housing.


California is the top spot for Chinese house hunters. Los Angeles, seen here, is becoming a go-to real estate market now that the city is seeing investments in new, luxury, urban, mixed-use housing.


“I’ve seen Chinese buyers spend $13 million on properties in the Baccarat without even looking at the place,” said Martin Purcell, a broker for Rutenberg Realty in New York. The Baccarat is a luxury hotel and residence property located on West 53rd Street.


Within the U.S., California is the leading destination due to its proximity to China, according to the National Association of Realtors.


By Juwai’s estimates, based on the number of searches and transactions placed on their website in the first half of 2014, the U.S. is followed by Australia once again this year. Here’s where China’s wealthy are looking for real estate:


No. 10:  Malaysia


Malaysia moves onto the list for the first time.  ”If you want a good proxy for where Chinese property buyers are looking, just look at the markets where Chinese developers are investing in projects,” says Andrew Taylor, co-CEO of Juwai.  Chinese buyers are coming to Malaysia thanks to local local developers Country Garden and Guangzhou RF Guangzhou RF expanding their property portfolio into Malaysia. And just like is happening in California, Chinese developer Greenland Holding Group is investing upwards of $3.25 billion in two mixed-used projects in the country.


No. 9: Spain


Spain was No. 9 in the first half last year, too. Anyone who has ever spent a weekend in Ibiza knows why.


No. 8: Portugal


Portugal makes the list for the first time, in particular because of a new investor-immigrant visa policy, for which 80% of applicants are Chinese. Foreign investors who spend 500,000 euros on a property earn the right to live in Portugal, travel in the EU and apply for Portuguese citizenship after six years. That’s very convenient for business people, students and others, notes Taylor.


No. 7: Singapore


Singapore slips two spaces this year and here’s why: The country recently introduced measures to curb overseas buying, especially Chinese.


No. 6: Thailand


Thailand moves up two notches this year, despite political uncertainty there. The resort town of Pattaya is the number one destination for Chinese buyers. “The strong interest suggests that the desire for a nearby vacation home outweighs any short-term concern about Thai politics,” says Taylor.  Chinese property purchases in Thailand run parallel to surging trade ties, with China expected to be Thailand’s number one trading partner within three years. The ASEAN trade pact among Thailand, Indonesia, the Philippines, Malaysia and Vietnam means that a Chinese entrepreneur with a vacation home and a factory in Thailand has access to a Southeast Asian market of 500 million inhabitants, notes Taylor.



China"s 10 Favorite Countries For Real Estate

Singapore"s ruling party runs into trouble


These are the best of times and the worst of times in Singapore, the world’s only global city without a natural hinterland, whose prosperity and good governance are the envy of much of the world, and a model for others to follow. But while the city-state remains an alluring success story to much of the outside world, Singaporeans themselves are starting to question the long-term viability of their longstanding adherence to elite governance, meritocracy, the primacy of growth, and state paternalism. The “Singapore consensus” that the People’s Action Party (PAP) government constructed and maintained in the last five decades is fraying, partly because many citizens perceive it to be outdated.


The Singapore consensus has been underpinned by the notion of vulnerability — that because of its small size, lack of natural resources, ethnic and religious diversity, and geographic location in a potentially volatile region, the city-sized nation is inherently and immutably vulnerable.


From this existentially anguished reality, a developmental belief system emerged. Its tenets include a strict academic meritocracy as the best way to sort talent; elite governance insulated from the short-termism and myopia of ordinary democratic pressures; the primacy of growth, delivered through a heavy dependence on foreign labour and capital; an acceptance of the need to equalise opportunities but not outcomes; and an indifference to inequality, as reflected in the state’s aversion to welfare.


The Singapore consensus made possible impressive socioeconomic development for much of the past 50 years, when demographic and economic conditions were also far more favorable. Yet today many Singaporeans are contesting it. At first glance this might seem odd: Singapore has one of the highest per capita incomes in the world. But its economic success masks some uncomfortable truths about life in this city-state.


Income and wealth inequalities in Singapore are among the highest in the developed world, while the cost of living has spiraled in recent years. For many of its residents, the country’s impressive material achievements have not translated into higher levels of happiness or well-being. In various surveys, Singaporeans are found to work some of the longest hours in the developed world and are described as one of the world’s least happy peoples. Almost three-quarters are afraid to get sick because of perceived high healthcare costs while more than half indicate they would emigrate if given the chance.


In December 2013, Singapore had its first riot in 50 years – reflecting its inability (and possibly, unwillingness) to accommodate the more than one million low-skilled foreign workers in Singapore. Yet its economic model is still highly dependent on taking in increasing numbers of such workers as Singaporeans continue to shun and stigmatize menial jobs. Two years ago, low-wage mainland Chinese bus drivers, bereft of bargaining power, instigated Singapore’s first labor strike in 26 years. Meanwhile, economic pressures coupled with the lack of efforts at fostering integration have led to an uptick in racism and xenophobia, tarnishing Singapore’s reputation for openness and tolerance. A country the business community long admired for its stability and openness to foreign nationals and ideas is now witnessing pent-up tensions bubbling over from time to time.


December 8, 2013: A passerby checks out the post-riot damage. | (AP Photo)


In many ways, Singapore is a victim of its own success. From the 1970s to 1990s, it developed from a manufacturing and trading hub to a global service and knowledge economy. In the process, a nascent, post-colonial misfit evolved into one of the world’s most well-governed states and dynamic economies. This rapid transformation, driven and engineered by the state, outpaced the ability of entrenched ideologies, policies and institutions to keep up.


At the same time, contradictions in the Singapore story are beginning to emerge. For instance, the government’s aspirations for Singapore to be an entrepreneurial and innovation-driven economy collide with the institutions, policies, and practices that inhibit risk-taking, experimentation, collaboration, and egalitarian norms — all of which are critical for a creative economy.


Singapore’s global city ambitions bump up against an emerging national identity. The nation faces an ideological quandary, as its own people question whether its strict academic meritocracy and the belief in the necessity of elite governance has also bred a narrow bureaucratic and political class that is increasingly out of touch with ordinary citizens. This has happened precisely as the electorate, increasingly weary of a sycophantic government-controlled national media, is seeking more mature engagement and debate about Singapore’s future.


By failing to adapt to these new socioeconomic and political realities, Singapore has set the scene for a fierce clash between competing societal and political visions. The big question is how to forge a new consensus — which will involve, among other things, greater welfare and lower immigration — without swinging too far in the other direction, and without undermining the very efficiency and openness that made Singapore so successful in the first place. At the same time, an increasingly plural political scene is likely to offer voters greater choice about the balance they want to strike.


In South Korea and Taiwan, the transition to full democracy was, initially at least, wrenching, socially divisive and politically destabilizing. But both countries managed eventually to amble towards stable, rule-based and competitive democratic systems. This, in turn, paved the way for the emergence of properly organized, collectively financed welfare states that enabled both countries to balance economic growth with social investments in areas such as healthcare, old age security and unemployment protection.


Singapore’s transition is likely to be much less wrenching and destabilizing. First, the city-state is nowhere near as repressive as the (military) dictatorships in South Korea and Taiwan that ruled until the 1980s. Equally important is the fact that the vast majority of Singaporeans are homeowners. A home-owning society is far less likely to upset the apple cart of stability and prosperity.


For these and other reasons, we are sanguine about Singapore’s transition to a liberal democracy with a far more redistributive state. Our optimism stands in stark contrast to the government’s fears about how increased democratic pressures here will make Singapore less governable, impede quick and enlightened decision making by elites who know better, and increase the likelihood of policies being made for short-term or populist reasons.


We think such fears are mostly misplaced. The contest in Singapore is less about basic political rights and freedoms. But neither is it just over “bread and butter” issues. Rather, it is a post-modern debate over people’s ability to determine what constitutes achievement and well-being. While a narrow focus on GDP growth and material prosperity helped to raise living standards early on, it has proven to be an incomplete barometer of success for Singaporeans. For businesses, investors and policymakers in Singapore, the days of easy political consensus, stability, and insulation from short-term electoral demands are over. Having sacrificed over a generation to attain prosperity, Singaporeans are now wrestling with what comes next.


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BUSINESS IN BRIEF 1/8

Positive outlook for German businesses in Vietnam


A recent survey reveals that 70% of German businesses operating in Vietnam hold a positive outlook on the economy in 2014 and are sanguine on prospects for continued buoyancy in the upcoming year.


The results of the survey, made public on July 29 by the German ASEAN Chamber Network (GACN), reflect the opinions of German invested businesses operating in –industry (48%), services (35%), business (9%), consultancy (6%) and auditing (3%).


The survey shows that 50% of the respondents report overall improved success in the past year and this positive outlook is being translated into ongoing plans to invest and recruit. Over 60% of the businesses plan to expand their workforce over the next 12 months.


However, 70% of the companies surveyed report they find it extremely burdensome to locate qualified engineers while 46% said it is essential for the country to develop a better skilled workforce.


Most of the companies have provided continuing education and organised training courses for their staff and workers, with 70% believing that the German vocational training model is a good choice for Vietnam.


A shortage of skilled workers was the number one obstacle reported in the survey followed by import barriers, corruption, inflation, and tax burden.


The survey reaffirmed the importance of the huge lucrative retail market in Vietnam to German businesses and the importance of free trade agreements (FTAs) contributing to their  optimism on the nation’s economic development.


Consumer confidence up in July


The ANZ-Roy Morgan Vietnam Consumer Confidence Index posted another strong gain, increasing by 3.1 points to reach 134.1 in July, to stand well above the 2014 average of 131.


ANZ Bank economists announced this in a report dated July 30, adding that easing of political tensions appear to have contributed to the increase in confidence during the month.


In terms of personal finances, 34% (up 2%) of the Vietnamese people say that their families are “better off” than a year ago, while 19% (down 1%) say that their families are “worse off”.


About 55% (up 7%) expect their families to be “better off” financially this time next year, compared to 6% (down 2%) who expect their families to be “worse off”.


As much as 61% (up 4%) of the Vietnamese people expect Vietnam to have “good times” economically over the next five years, compared to 7% (down 4%) who expect “bad times”.


However, 47% (down 2%) expect the country will have “good times” financially during the next twelve months, while 15% (down 1%) expect “bad times”.


Thirty-seven percent (down 1%) of the Vietnamese people say now is a “good time to buy” major household items, compared to 17% (up 3%) who say it is a “bad time to buy”.


“We believe the economic backdrop will be one of sure-and-steady recovery, rather than a V-shaped rebound,” said Glenn Maguire, the chief economist of ANZ in Asia-Pacific.


Consumer confidence sitting above the 2014 average is aligned with Vietnam’s ongoing economic momentum. However, further strong gains in confidence will need to be propelled either via wealth effects from higher equity and gold prices, or a faster improvement in the economy.


“We would now assess confidence as being more likely to move sideways at elevated levels rather than continue to make strong gains,” said Glenn.


The ANZ Bank and Roy Morgan Research launched the monthly private consumer index for Vietnam earlier this month, with surveys covering major cities and provinces across the nation.


The consumer index jumped 7.7 points in June.


Dong Nai cashew nut exports up in volume, value


Southern Dong Nai province exported 3,000 tonnes of raw cashew nuts earning US$19.7 million in July, up 7.1% in volume and 11.9% in value on-year.


The average price of raw cashew nut exports for the month hovered around US$6,588 per tonne, 6.2% higher than same period last year’s same period.


In the first seven months of the year, the province exported a total of 15,200 tonnes of raw cashew nuts, grossing revenues of US$98.6 million, up 22.5% in volume and 30.6% in value.


Key cashew nut export markets include the US (US$42 million), China (US$22 million), Canada (US$6 million), the UK (US$4 million), the Netherlands (US$4 million), Australia (US$4 million) and Thailand (US$2 million).


Markets showing a decline included Canada (down 14.3%) and New Zealand (47%).


Advanced fisheries surveillance ship handed over


Vietnam’s second most advanced surveillance ship was handed over on July 30 to the Vietnam Fisheries Surveillance Force in northern Quang Ninh province by Ha Long Shipbuilding Co, Ltd.


The vessel – coded KN-782 – is 90.5m-long, 14m-wide and 7m-high and has been under construction since October 2012. It has a displacement of 2,500 tonnes and a maximum speed of 21 nautical miles per hour with a total capacity of 12,016 horse power.


Speaking at the handover ceremony, vice chairman of the provincial People’s Committee Do Thong said the Party and State have paid special attention to ensuring the fisheries surveillance forces and coast guard are adequately armed to protect sea and islands’ sovereignty, implement rescue work and assist fishermen at sea.


Nguyen Van Trung, deputy head of the Vietnam Fisheries Surveillance Department emphasised that the KN-782 ship helps instil confidence in fishermen that they will be adequately protected.


HCM City targets higher budget revenue in 2015


The Ho Chi Minh City local government has mapped out a plan to boost budget collections for 2015, with domestic revenues targeted to rise 14 -16% and earnings from export and import to increase 6-8 percent, the Saigon Times Daily reported on July 30.


The target was pointed out in the city’s budget plan for 2015 issued by the HCM City government last weekend.


In 2014, the total revenue of HCM City is estimated at VND226.3 trillion, or 0.53% lower than in 2013. Of the figure, domestic revenues are expected to contribute VND124.2 trillion, while some VND74.8 trillion will come from exports and imports, and VND27.3 trillion from crude oil.


The total revenue this year to date has amounted to VND148.5 trillion, or 14.3% higher than the same period last year. Domestic sources generated VND 81.89 trillion and export-import tax collections contributed VND48.5 trillion, rising 17.2% and 15.8 percent compared to 2013, respectively.


According to the HCM City Department of Finance, the increasing amount of tax collections is attributed to greater efforts to attract foreign investment, high consumption of consumer goods, cars, and oil and gas revenues. Other sources such as personal income tax, registration charges and land use fees are also higher.


Besides, the recovery of many manufacturing firms had positive impacts on the city’s revenues.


Speaking at a conference in June on the city’s socio-economic performance in this year’s first half, Chairman of the HCM City People’s Committee Le Hoang Quan expected the local economic recovery since 2013 will continue to gain tempo in the coming years.


Vietnam-UK trade gathering steam


Trade turnover between Vietnam and the UK picked up the pace in the first five months of the year, striking US$2 billion, according to statistics from the Vietnamese Trade Office in the UK.


Vietnamese exports to the UK totalled US$1.6 billion, consisting principally of mobile phones (accounting for 40%), garments and textile (12.5%), interior decoration accessories (9%), machinery and components (7%), plastic products (3%), coffee, tea, spices (2.5%), seafood (2%), and fruits (1%).


Major imports of Vietnam included turbine, machinery and equipment (24%), pharmaceutical products (11%), mobile phone accessories recording equipment (9%), chemicals (7.5%), healthcare equipment (6%), plastic products (5%), iron and steel (4%),  cattle feed (4%), molluscs and aquatic invertebrates (3%), and ink, dyes, detergents, and paint (2.5%).


Vietnamese Trade Counsellor Nguyen Thi Hong Thuy noted though trade ties between the two countries are enjoying fruitful development, Vietnamese enterprises are still confronted with a number of difficulties competing with Europe, India, China, and Brazil.


A series of trade and investment promotional activities are being organised in the UK and Vietnam including conferences, seminars, and cultural exchanges to address these shortcomings in hopes of increasing Vietnamese competitiveness in the UK market, she said.


Thuy revealed that the UK has spent GBP8 billion (US$13.6 billion) in recent times on investment and trade promotions, aiming to boost exports and investment in highly prospective markets, including Vietnam.


However, differences in development levels and business culture are a big obstacle to increasing Vietnamese exports to the UK.


She pointed out the fact that most Vietnamese businesses are small and medium-sized in terms of financial and management capacity, finding it hard to market their products in the UK.


That’s why Vietnamese businesses need more time to carefully explore, penetrate and find a firm foothold in a well-organised distribution network in the UK.


Trade surplus tops $1.3b in first 7 months


The country’s trade surplus in the first 7 months of this year reached US$1.26 billion thanks to a good export performance, the General Statistics Office reported.


The result was due to an improvement in export value which reached $83.5 billion in the first 7 months, up 14.1 per cent compared to the same period of last year.


There were a number of high-valued export staples including marine products with an increase of 25.5 per cent to $4.23 billion, textile and garment industry with a rise of 19.4 per cent to $11.48 billion and phones and accessories manufacturing that showed a growth of 13.9 per cent to $13.15 billion.


Crude oil export value also made up $4.61 billion, up by 5.8 per cent in volume and by 8.3 per cent in turnover.


The GSO stated that the export turnover could reach a higher value if there was no reduction of export value in agricultural products. These included rice exports with 3.86 million tonnes worth $1.75 billion, down 8 per cent in volume and 4.7 per cent in value.


A decrease in rubber exports also contributed to the situation with 454,000 tonnes worth $832 million, down 9.5 per cent in volume and 32 per cent in value.


In the first seven months, the country’s import value was $82.24 billion, up 11.4 per cent year-on-year.


The GSO said that the country spent most for imports of raw materials for production such as cotton which increased by 35 per cent to 458,000 tonnes and 36.3 per cent in value to $919 million.


The value of imported machines and spare parts increased by 24.4 per cent to $12.65 billion, and fabric import value reached to $5.5 billion, an increase of 16.7 per cent.


The GSO said that China remained Viet Nam’s largest import market with a total turnover of $23.4 billion, an increase of 15.3 per cent compared to the same period last year. The figures brought the trade deficit with China to $14.8 billion, up 14.4 per cent over the same period of 2013.


Most of the imported products from China were textile raw materials, machines and equipment for energy industry, light industry, consuming products and electronic products.


Viet Nam also spent significant values for importing goods from ASEAN and South Korea markets with import turnover of $13.4 billion and $12.3 billion, up 8.4 per cent and 6.3 per cent, respectively.


Import value from Japan, EU and the US were low range between $3.7 billion and $6.9 billion.


Solutions proposed to develop support industries


Support industries are the backbone of the country’s industry, according to Truong Thanh Hoai, deputy director of the Heavy Industry Department of the Ministry of Industry and Trade.


Further, support industries play a key role in raising the competitiveness of industrial products and are a decisive factor in the development and enhancement of the nation’s competitiveness. Without having support industries, it would be impossible to operate manufacturing industries, Hoai said during a workshop to discuss solutions to develop support industries in Viet Nam, held by HCM City Economics University and the Economic Commission of the Party Central Committee in HCM City yesterday.


Regarding developing solutions for support industries in Viet Nam, Professor Vo Thanh Thu said developing support industries must focus on key industries in Viet Nam, including those attracting large foreign investments, such as garments and textiles, engineering and electronic assembly. These industries have a large demand for support industries, as well as provide a need to modernise technologies and train highly-qualified workers to produce standardised products.


Thu emphasized that investment in technology required large amounts of capital. To assist enterprises, the Ministry of Finance and the State Bank of Viet Nam should work out policies to create favourable conditions for enterprises to have access to long-term loans with preferential interest rates. A representative of the HCM City Department of Industry and Trade told those at the seminar that support industries in Viet Nam were mainly catering to export processing technologies, while manufacturing industries largely relied on imported raw materials and components.


In addition, the country has not yet developed specialized industrial complexes, resulting in underdeveloped support industries.


The HCM City Department of Industry and Trade has proposed a series of measures to develop support industries by offering incentives to attract FDI businesses. It is stated that FDI businesses are an important driving force to promote domestic support industries.


The department has also suggested that the Government consider a master plan for support industries and offer credit loan policies for businesses to develop support industries and human resources in support industries.


Hoai said the Ministry of Industry and Trade is now developing a decree on the development of support industries, and is expected to submit to the Government in the fourth quarter of this year.


Hoai added that the decree would focus on measures to support technology, production management and customer services to avoid shortcomings in local support industry companies.


Furthermore, the decree would supplement incentives on corporate income taxes and construction regulations on the building of support industry complexes to attract global multinational corporations to provide parts and materials to invest in Viet Nam.


Subsidence blamed on residents


Construction conducted by nearby residents has caused the pavement along the O Cho Dua-Hoang Cau road, the most expensive route in Viet Nam that opened early this year, to subside, said Nguyen Sy Bao, the director of the management board on key urban development projects in Ha Noi.


Speaking at the press conference on Tuesday, Bao said the pavement subsided after a short period of construction after residents demolished their old houses. Residents then gathered concrete stakes and drove excavators and trucks over the new pavement.


Bao confirmed that samples of bricks used on the pavement had been tested to meet quality standards.


The loose management and co-operation between the project’s investor, inspection consultancy unit and local authority had enabled the damage, he said.


The investor had asked the construction unit to quickly re-build 165 square metres of the damaged pavement, repair the covers of manholes and reduce the height of the pavement to help drivers go up and down more easily.


The pavement had since been fixed, he said, adding that a cost of more than VND70 million (US$3,301) was incurred by the project’s contractor.


Bao said the management board would re-examine the incident to establish the fault of those involved, including four units participating in constructing, designing, consulting on and supervising the project.


In June, Ha Noi Party Secretary Pham Quang Nghi had requested a re-examination of the construction of the pavement on the O Cho Dua-Hoang Cau route following inspections.


He said that each phase of the project would reveal the responsibilities of those responsible for the poor-quality pavement.


The O Cho Dua-Hoang Cau road route was part of the city’s Belt Road No1 project costing VND642 billion ($30.5 million), including $25 million for site clearance.


However, the real amount for site clearance had been raised to VND743 billion ($35.3 million), making it the most expensive road in the country.


Although the city has opened the road for traffic, the installation of lighting systems, separators, painted lines, pipelines and trees is yet to be finalised.


VN exports face tough challenges


Low value adds, poor quality of exports and heavy dependence on raw material imports along with poor processing facilities and transportation were affecting the country’s export quality and efficiency.


Nguyen Thi Thu Hang, senior technical consultant at Export Potential Assessment (EPA), told a conference in Ha Noi yesterday that limited understanding about foreign markets and international trade issues and inadequate market information, poor supply chain and sector linkages as well as outdated production and processing technologies for export products were also problems plaguing the country’s exports.


EPA is the first major activity of the four-year “Decentralised Trade Support Services for Strengthening the International Competitiveness of Vietnamese Small and Medium-sized Enterprises” programme, being implemented nationally by the Trade Promotion Agency.


In order to deal with these issues, Hang emphasised on the importance of promoting the implementation of the State’s preferential policies in support industries to solve input material shortages.


Besides, to enhance linkages in supply chains to reduce cost, improving product quality and competitiveness of exports, diversifying export markets and accelerating trade promotion were also necessary, she said.


She added that improving the capacity of domestic enterprises in negotiating, contracting and getting international transactions reduced should be also included.


On his speech at the event, Deputy Minister of Industry and Trade Do Thang Hai said Viet Nam was attempting to increase exports of high-value goods while reducing shipments of raw materials abroad.


The country was also fostering its negotiations of Free Trade Agreements with foreign countries to expand export outlets, he said.


In the future, it was necessary to identify and assess products and services which had an export potential and then focus on accelerating exports of these goods, he noted.


According to a report which was also released at yesterday’s conference, the items with high export potentials in the short to medium terms were coffee, rubber and cassava along with pepper, garments and leather shoes. Seafood such as tuna and shrimp were also on the list. Electronics, textiles and garment, and wooden goods apart from bamboo and rattan products, were also items with high export potential. Tourism and labour were items on the list.


SBV approves new Construction Bank head


The State Bank of Viet Nam (SBV) has approved a new chairwoman and general director of the Viet Nam Construction Bank (VNCB).


The decision follows the arrest and temporary detention of the bank’s three former senior officials on July 29.


The new chaiworman is Vu Bach Yen, who has been a member of VNCB’s executive board since February 2012 and is a major shareholder. Meanwhile, the bank’s Deputy General Director Dam Minh Duc, who was in charge of the bank’s operations in Ha Noi, is the new general director.


According to the Ministry of Public Security’s Investigation Police Agency, the three former officials were arrested on Tuesday for allegedly violating Viet Nam’s Penal Code’s Article 165.


The Article deals with deliberate acts against the State’s regulations on economic management, leading to serious consequences.


The arrested persons are Pham Cong Danh, 49, former chairman of VNCB; Phan Thanh Mai, 43, former member of VNCB’s executive board and general director; and Mai Huu Khuong, 31, former member of VNCB’s executive board, in charge of finance.


On Monday, a day before they were arrested, SBV announced that the three officials had been dismissed from VNCB’s service to ensure normal operations of the bank.


VNCB was established from the Trust Bank in May 2013. The Trust Bank was in operation for 23 years with a charter capital of VND3 trillion (US$142.85 million).


It’s reported that Mai, Danh and Khuong were elected members of VNCB’s executive board in February 2013. Then Mai was appointed as the bank’s general director.


Danh was also Thien Thanh Group Ltd Company’s chairman of the board of directors.


Thien Thanh Group Ltd Co is a subsidiary of the Thien Thanh Group, based in HCM City. Its businesses include construction materials, auto services, real estate, finance and hotels.


Meanwhile, Khuong was also chairman of the executive board of the Dai Viet Stock Company, while Mai was a member.


The case is being investigated further.


Pan Pacific stitches up tender for largest stake in Vinaseed


Pan Pacific Corporation (PAN) announced it has become Viet Nam National Seed Corporation’s (NSC) biggest shareholder after completing the tender offer for its shares.


According to its filing on the HCM City Stock Exchange yesterday, Pan Pacific has bought 4.63 million shares of Vinaseed, lower than the total 6.23 million shares it registered while buying.


PAN’s total holdings in the seed firm increased from 2.47 million shares to nearly 8.14 million shares, equivalent to 53.2 per cent of the firm’s stakes that makes NSC a PAN subsidiary.


The company could spend over VND352 billion (US$17 million) to own NSC shares as in March, PAN offered to buy their shares at a price of VND76,100 (US$3.61) per share from May 30 to July 15.


Sellers included Sai Gon Securities Inc (SSI) who sold out all its holdings of over 2.42 million shares in July.


NSC shares fell 0.7 per cent to close yesterday’s session at VND74,500 ($3.53) a share while PAN shares tumbled 3.1 per cent to end at VND47,500 ($2.25) each.


The acquisition of Vinaseed has shown PAN’s investment strategy to expand business in the agricultural sector in which Vinaseed is a leading company in the field of plant varieties.


NSC is a stable performer with profits rising steadily from 2009 to 2013. It estimates a profit of VND59 billion ($3 million) in the first half of this year, equivalent to 51 per cent of its yearly profit target and a rise of 9 per cent against the same period last year.


Apart from Vinaseed, Pan Pacific owns 62.4 per cent stake in Ben Tre Forestry and Aquaproduct Import and Export Co (ABT), and 23 per cent in Long An Food Processing Export Co (LAF).


PAN is operating in administrative and support services with 10 business lines, including agricultural and seafood production, home care services and industrial solid and liquids apart from gas waste treatment services and high-rise building and apartment management services.


Pan Pacific incurred losses of more than VND2 billion ($95,000) last year and is under warning status by the HCM Stock Exchange. Its first-half net profit is projected at VND22.5 billion ($1 million), six times the same period last year.


VSA sees slight increase in steel sales in July


The Viet Nam Steel Association (VSA) has reported that steel consumption in July was 380,000 tonnes, an increase of 1 per cent against last month.


In July, steel plants churned out only 400,000 tonnes, which was lower than the designed output due to low demand.


The Vice President of VSA, Nguyen Van Sua said that steel consumption could decrease in August due to the rainy season.


VSA forecast that the steel industry will increase business by 10 per cent this year.


Footwear exports fetch more than $1.1b


The southern province of Dong Nai has earned more than US$1.1 billion from footwear exports in the first seven months of this year, up 12.8 per cent year-on-year.


According to Director of the provincial Department of Industry and Trade Le Van Danh, in July alone, the export of this product brought $167 million to the province, up 16.4 per cent over the previous month and 5.1 per cent compared to a year earlier.


He said that growth was seen in almost all markets, led by the Republic of Korea with $323 million and the US with $309 million. They were followed by Belgium with $98 million, China with $50 million and the UK with $75 million, he said.


Local businesses attributed the growth to the Generalised System of Preferences (GSP) that the European Union has granted to Viet Nam, coupled with the economic recovery in many markets, including the EU and the United States.


Unsold sugar inventory reaches nearly 460,000 tonnes


The unsold volume of sugar at factories was estimated at 457,890 tonnes as of July 15, 32,160 tonnes higher than a year earlier, an official of the Ministry of Agriculture and Rural Development (MARD) said.


However, this will not be a serious problem if the current effective control of smuggling can be maintained, according to Doan Xuan Hoa, deputy head of MARD’s Department of Processing and Trade for Agro-Forestry-Fisheries Products and Salt Production.


At the same time, he pointed to the fact that most sugar makers have not formed partners with distributors, thus their sales depend much on the market. As a result, they are under great pressure when supply overcomes demand on the domestic market. To add to the problem, sugar export is also facing many difficulties.


Hoa urged the Vietnam Sugarcane and Sugar Association and businesses to devise production and sales plans for 2015 so as to ensure supply and demand balance in the domestic market.


The department forecasts the sugar output from now to the end of 2014 at 300,000 tonnes, while imports this year are expected to reach 77,300 tonnes, bringing total supply to 835,190 tonnes.


Meanwhile, sugar consumption is predicted to be at the same level as last year, resulting in unsold inventory of around 251,240 tonnes by the end of the year.


Personnel appointed for Steering Committee for Price Regulation


Deputy Prime Minister Vu Van Ninh who is head of the Steering Committee for Price Regulation, has appointed Finance Minister Dinh Tien Dung as deputy head of the committee.


Nine members of the committee were also named under Decision 52/QD-BCDDHG freshly signed by the Deputy PM. They are officials from the Ministries of Finance, Industry and Trade, Planning and Investment, Public Health, Education and Training, Transport, and Agriculture and Rural Development, as well as the Government Office and the State Bank of Vietnam.


The Steering Committee for Price Regulation was set up in May this year with Deputy PM Ninh as its head under the Prime Minister’s Decision 690/QD-TTG. It is responsible for studying and helping the Government leader consider and approve major policies and orientations for price management in a certain period, as well as specific measures to stabilise prices for essential goods and services.


The committee will also assist the PM in directing local and municipal ministries and agencies to manage prices, serving the targets and requirements of the Government on curbing inflation and stabilising macro economy.


In addition, it will hold seminars and conferences for experts to share experience in and out of the country to improve the operational efficiency of the committee.


Philippine firms encouraged to invest in Vietnam


Vietnamese Ambassador to the Philippines Truong Trieu Duong has called on Philippine businesses to expand their investment in Vietnam.


Speaking at the 22nd Metro Manila Business Conference recently held in Manila, the Ambassador briefed participants on Vietnam’s economic integration policies as well as the country’s advantages.


Philippine firms said they highly value Vietnam’s investment environment and took this opportunity to thoroughly enquire about business opportunities in country.


Hosted by the Philippine Chamber of Commerce and Industry, the conference aimed to gear up for regional integration as an ASEAN economic community will be formed by 2015.


Many barriers to business remain, says expert


Many policy drafting agencies tend to resort to the “prohibition” term for the business scopes that are hard to control and this has set up many barriers to the country’s business environment, said the director of the Central Institute for Economic Management.


Speaking at a seminar held in Hanoi Thursday to introduce the revised Enterprise Law, Nguyen Dinh Cung described the legal documents about allowable and conditional business areas as a maze. “We assume these documents would be a cubic meter if they are put together,” Cung said.


Cung said regulations for the prohibited business areas regarding dangerous games for children and their character development, social security and order, sexual products and scrap imports which can pollute the environment among others are unclear as there are a lack of detailed criteria and definitions.


Such regulations, according to Cung, can be interpreted differently by different market monitors depending on their worldviews, and this puts producers and traders at risk.


“Individuals at State management agencies can take advantage of different interpretations for their private gains,” he warned.


The regulation banning enterprises trading pollution-causing scrap imports, according to Cung, is also unreasonable. He wondered whether enterprises are allowed to trade domestic scraps or not.


Cung noted the Enterprise Law is ruled by 20 industry-specific laws and regulations, and ministries and sectors make full use of these laws to protect their interests.


However, chairman of the Vietnam Tea Association Nguyen Huu Tai disagreed with Cung.


Tai said food producers should strictly follow the regulations on safety and hygiene of the Ministry of Health rather than the Enterprise Law. He furthered a person owns a big piece of land in a downtown area of a city but he is not allowed to raise pigs on his land as he should observe the Land Law.


Dau Anh Tuan, head of legislation at the Vietnam Chamber of Commerce and Industry, said in support of Cung that the Enterprise Law would be invalid if industry-specific laws and regulations set too many business conditions.


Tuan said the inclusion of business lines with special requirements in the Enterprise Law or in decrees needs careful consideration as it cannot be kept updated with the reality.


Two contractors banned from road projects


Two consulting contractors responsible for supervising a project to construct a road connecting Vi Thanh Town in Hau Giang Province with Can Tho City in the Mekong Delta have been prohibited from joining any traffic projects for 18 months for not fulfilling their duties properly.


The Ministry of Transport in a decision issued on July 24 banned Consulting and Construction Ltd., Co. 747 and Design Consultant Enterprise, an arm of Investment Construction Joint Stock Company No.10 under the Vietnam Urban and Industrial Zone Development Investment Corporation (IDICO).


The two consultants are found by the ministry to have violated regulations in supervising the project’s quality and progress and failed to perform their contracts duly.


Apart from these two contractors, over then other units relating to the construction of the road have also had their works reviewed to guarantee the project’s quality.


Previously, the transport ministry made a snap inspection into the project, invested by the Hau Giang Province’s Department of Transport, and identified many violations by contractors.


Gov’t orders customs procedures simplification


Prime Minister Nguyen Tan Dung has told the Ministry of Finance and its General Department of Customs to remove unnecessary customs procedures to help enterprises at a time of economic hardship.


In Notice 289/TB-VPCP, the Prime Minister requests that import and export goods clearance time should be cut by 50% from the current level by the end of 2014. Paperwork should also be streamlined.


In 2015, Vietnam should reach the same standards of the countries in the ASEAN-6 bloc of Indonesia, Thailand, Singapore, the Philippines, Malaysia and Brunei with the average time of completing export and import procedures and customs paperwork reduced to 171 hours a year.


The Government orders the General Department of Customs to further speed up application of information technology and deployment of the ASEAN one-door mechanism and the One-door Customs Mechanism.


The Ministry of Finance will have to cooperate with relevant units to secure consistency in management of export and import goods, people and means of transport traveling into and out of the country.


Relevant agencies are required to review the policies issued in recent times to help the Government work out decrees guiding implementation of the amended Law on Customs. The National Assembly has recently passed the law to ensure administrative reform goals and requirements will be met.


Notably, the Government requests stricter management of customs staff, especially at grassroots levels, to prevent wrongdoing in the process of customs clearance. Officials who violate rules must be eliminated.


Meanwhile, the Ministry of Finance and the General Department of Customs will draw up a project allowing the non-State sector to join equipment procurement and infrastructure investment contracts in the customs sector. The contracts aim to improve supervision and goods checks by the customs.


The Government will continue investing in scanners to check goods and enhancing supervision at border gates.


The General Department of Customs should encourage private firms to join customs service and agent sectors. The department will initiate a pilot scheme to apply a consistent management model at border gates by arranging courses for officials.


Initially, the model will be piloted by the customs departments in Haiphong City and HCMC. The ministry will report the project to the Government before November 1.


According to the Doing Business 2014 report by the World Bank (WB), Vietnam now ranks 65th among 189 economies in terms of customs procedures.


It normally takes enterprises in Vietnam 21 days to finish export papers, compared to only 11 days in the member countries of OECD (Organization for Economic Co-operation and Development).


In addition, it costs firms in Vietnam US$610 to ship a container, compared to US$450 in Malaysia and US$856 in East Asia-Pacific.


Liquidity risk still high at EVN


The power purchase deals between Vietnam Electricity Group (EVN) and its subsidiaries lack transparency with huge losses offset internally, which are among reasons for high liquidity risk at the group, said State Audit of Vietnam.


According to the auditing result for 2012, five power corporations of EVN owed the parent firm as much as VND9.88 trillion worth of electricity and the amount the parent company owed power plants also amounted to VND6.06 trillion.


The debt amounts collectible and payable between the parent company and its subsidiaries were quite high but EVN did not perform good bookkeeping to monitor and analyze such debts. Besides, debt payments made by power purchasing companies to power plants were often late.


According to State Audit of Vietnam, power purchases between the parent company and subsidiaries and affiliates were not objective as the internal power price in 2012 took into account the losses incurred in 2011. By lowering the internal price, the parent company offset losses for five subsidiaries with a total of nearly VND1.72 trillion.


Besides, the parent company underwrote the losses of VND865 billion incurred in 2011 for its two wholly-owned thermal power companies, with VND722 billion for Uong Bi thermal power plant and VND143 billion for Can Tho Thermal Power Company, said Nguyen Hong Long from State Audit.


EVN also owed other groups like Vietnam National Oil and Gas Group and Vietnam National Coal and Mineral Industries Holding Corporation a combined VND16.07 trillion as of 2013, most of it overdue. However, EVN had pledged to pay VND2.65 trillion by December 31, 2013 and the rest would be paid within seven years, with VND1 trillion to be paid each year.


According to Long, EVN earned a profit of around VND8.82 trillion in 2012 and the return on equity ratio was 7.52%, though the group earmarked over VND10 trillion to cover exchange rate changes and other amounts to provide for losses of previous years.


EVN borrowed much to invest in power generation and transmission systems, with loans totaling VND25.04 trillion as of 2013, including short-term loans of VND6.1 trillion.


With business results improving gradually, EVN’s long-term loan payment capacity in the next five years, according to State Audit, is ensured thanks to the amortization of assets as well as its supplementary assets being revalued.


Philips introduces smartphones in Vietnam


Dutch electronics giant Philips has launched its latest smartphone models and announced a new distributor in Vietnam.


Smartcom Co. has been picked by Sangfei Mobility Singapore, a company that holds the right to trade Philips smartphones on global markets, as the authorized distributor of Philips handsets in Vietnam. Smartcom has been selected as it has much experience in distributing major brands, including Sony, HTC, Blackberry and Gionee.


With the debut last week, Vietnam was chosen by Philips as the first market in Southeast Asia for its four new smartphone models of S308, S388, W6110 and i908. These cellphones are retailed for VND1.29 million to VND6.99 million (around US$60-329).


Philips has also introduced its feature phone X2566 to the Vietnamese market.


Long-lasting battery technology is among the highlights of Philips phones.


Philips had its cellphones distributed by Thanh Cong Mobile in Vietnam in 2009.


Supporting industries lack effective policies


Vietnam’s supporting industries have made slow progress in the past decade due to a lack of effective policies to support their development, according to the Japan External Trade Organization (JETRO).


Yasuzumi Hirotaka, managing director of JETRO in HCMC, told a function on establishing the Japan-Vietnam supporting industries forum last week that policy-making agencies had not fully understood the needs of enterprises.


The lack of effective policies to spur Vietnam’s automobile industry is a case in point. This is one of the brakes on development of supporting industries in this market, Hirotaka said.


Therefore, the HCMC Export Processing Zones and Industrial Parks Authority (HEPZA) and JETRO in HCMC signed a memorandum of understanding to boost supporting industries in this city, including the establishment of the Japan-Vietnam supporting industries forum. This forum is expected to bring the requests of both Vietnamese and Japanese firms to policy makers and help them get a better understanding of businesses.


According to Hirotaka, the forum will also assist in human resource development for supporting industries as if there are not qualified people making technological transfers happen, it is difficult for local businesses to grow and benefit from technological advances despite strong foreign investment inflows.


As Japanese firms have not found good local enterprises in supporting industries, JETRO and HEPZA will make a list of businesses at exporting processing zones and industrial parks in HCMC that can meet the demand of Japanese firms.


There were 311 Vietnamese enterprises active in supporting industries as of last year. Many foreign enterprises operate in supporting industries Vietnam but their products are mainly for export.


There are many final products made in Vietnam but their localization rates are low. A 2013 survey of JETRO showed that the average rate of products by Japanese enterprises in Vietnam were 32.2% last year compared to 27.9% in 2012.


Citibank launches new credit card


Citibank Vietnam has launched the international credit card Citi Rewards, targeting office workers and young consumers in the country.


Raul Parades, Citibank Vietnam’s consumer business manager, said Citi Rewards is the first product to enable customers to accumulate far more bonus points than other credit cards. The points can be redeemed for gifts, including music players, cell-phones and entertainment services.


In addition, card holders can enjoy privileges at Citibank partner restaurants, hotels and shopping centers.


The group has introduced Citi Rewards in several markets in Asia-Pacific such as Hong Kong, the Philippines, Indonesia, Thailand, Taiwan, India, Malaysia, China and Australia.


Citibank joined the local retail banking market in 2009. Earlier, it launched other credit cards onto the market such as Citibank PremierMiles World MasterCard, Citibank Visa Platinum Cask Back and Ready Credit.


HCM City’s credit growth better than expected


The amount of total outstanding loans in HCMC is estimated at VND984 trillion in the first seven months of this year, a rise of 3.35% compared to end-2013, heard a meeting on the city’s socio-economic situation yesterday.


The central bank’s HCMC branch earlier estimated the city’s credit growth rate by end-June at 1.32%, but the rate actually increased to 2.84%.


Nguyen Hoang Minh, deputy director of the State Bank of Vietnam’s HCMC branch, told the Daily that the accelerating credit growth rates in June and July were attributed to the city’s bank-business capital connection program.


Up to date, there have been 701 companies, two cooperatives and 25 family-run businesses approved by banks for loans totaling VND15.7 trillion.


The total amount from the program is expected to reach VND28-30 trillion at the end of this year compared to the earlier estimate of around VND20 trillion, Minh said.


As many as 34 companies will also borrow an additional sum of nearly VND1.9 trillion from banks on August 8 with the annual interest rates of 7.5% for short-term tenors and 9.5-10.5% per annum for medium and long-term tenors.


Businesses in fact have accelerated borrowing money from banks to support their operations. However, certain obstacles concerning bad debts and stockpiled goods are reasons behind the low credit growth rate.


The ratio of bad debts stood at 4.84% as of end-May, up 0.15 percentage point against the end of last year.


The city’s export turnover hit US$16.4 billion, a year-on-year rise of 3.5%, in the first seven months of this year, director Thai Van Re of the city’s Department of Planning and Investment told the meeting.


Certain exported products enjoyed good results including pepper, up 85.8% year on year, followed by vegetables and fruit with a 48.5% increase, machines and equipment up 37%, aquatic products up 14.8%, coffee up 14.6%, rice up 11%, apparel up 8.6% and footwear 7.4%.


Meanwhile, the city’s import revenue stood at US$14.14 billion in the first seven months of this year, an 8% year-on-year fall.


Notably, goods from China that account for 22% of the total import revenue inched down 1.9% in value. However, imports from Singapore surged by 45.8% in value, followed by goods from the U.S. up 28.3%, Taiwan 18.5%, South Korea 11.7%, Thailand 4.8% and Japan 4.1%.


The city used to buy a wide variety of products from China, ranging from machines and equipment, electronics, metal to materials for agriculture.


However, China’s illegal placement of an oil rig in Vietnam’s waters in early May has influenced the export-import activities between the two countries, but it is also deemed as an opportunity for the city to lessen economic dependence on China.


Source: VEF/VNA/VNS/VOV/SGT/SGGP/Dantri/VIR



BUSINESS IN BRIEF 1/8

Job-hunting Koreans should look overseas

The Presidential Committee on Young Generation on July 24 released its list of the 10 most attractive countries for Korean job seekers, ranging from Germany to Vietnam.

The countries that made the list have the best conditions for Korean workers, largely due to efforts by the government and businesses to expand trade relationships, particularly in the Middle East and Europe.


The list ranks Germany as No. 1, followed by Austria, Qatar, the United Arab Emirates, Australia, Japan, Hong Kong, the United States, Vietnam and finally Singapore. The top 10 were chosen in a study of 103 nations where Korean businesses currently operate and is based on demand for foreign workers, the country’s business relationship with Korea, the average salary, the unemployment rate, and the number of new foreign-owned businesses.


The study was conducted by a research team led by Korea Polytechnic University Professor Seo Jong-hyen based on data provided by Korea Trade-Investment Promotion Agency (Kotra) and the Human Resources Development Service of Korea. The 103 countries were narrowed down to 45 based on per capita gross domestic product, economic growth and foreign direct investment and final 10 were selected based on the job market.


“Traditionally, North America and Europe have been the most desirable destinations for young Korean job seekers,” said Yi Do-kyeong at the Human Resources Development Service. “However, emerging countries in Asia and the Middle East can be an even better choice … for young people in building up strong career experiences.”


Yi said that foreign companies with ties to Korea – through the owner, manufacturing Korean brands, or by joining a consortium with Korean companies – were more likely to hire Korean workers.


Of the top 10 countries in Asia, Japan and Singapore showed the highest demand for foreign talent and fewer barriers to obtaining a visa, largely due to a work-force shortage. According to the study, Japan is open to foreign workers who want to enter industries that lack Japanese professionals, such as IT and mechanical engineering.


The data says the country will need to fill positions for at least 500,000 IT professionals by the end of 2015, including software developers. Like Japan, Singapore is scheduled to create about 80,000 IT-related jobs by December 2015. Singapore also lacks financial specialists, hotel managers and art curators and both countries have high demand specifically for Korean employees.


Hong Kong scored the best for ease of obtaining a visa and had the highest demand for Koreans, since it is Korea’s sixth-largest trade partner and there are many Korean businesses there. The country recorded a low unemployment rate of 3.3 percent last year, and has openings in finance, hotel and restaurant management and shipping.


Vietnam was picked for its abundance of Korean companies and of their strong network in the country. As Korean businesses have been gradually moving their production and shipping lines out of China for a decade, Vietnam’s demand is high for Korean workers with a bachelor’s degree who want to work in managerial positions. A recent memorandum of understanding between the Korean and Vietnamese governments agreed to waive the requirement of five years of work experience to qualify for a management position, as long as the applicant’s certifications are recognized by the Korean government. The country also has openings for jobs in its airlines industry.


Because Korean companies have recently signed contracts in Qatar and the UAE in sectors from construction and energy to medical and service industries, the two nations were picked for their large demand for Korean workers and for their good job market.


Qatar had one of the lowest unemployment rates in 2012 at 0.7 percent. About 90 percent of workers in the UAE are foreigners and work visas are not complicated. The countries showed high demand for construction and shipbuilding engineers, hotel managers, airline workers and medical professionals. The study also recommended Saudi Arabia, Kuwait, Turkey and Israel.


In Europe, Germany and Austria had healthy job markets and high demand for Koreans to work in the IT, machinery and auto industries. Germany has a strong technology industry and its steady economic growth will lead to demand for five million tech professionals by 2025. Because of this, the country recently decided to ease its policies for working visas.


Austria has the lowest unemployment rate in the European Union at 4.7 percent and is loosening its visa restrictions to attract professionals in shipping, retail and IT. The Netherlands, Norway, Sweden, Switzerland and France were also recommended in the study.


As a lot of Koreans work in the United States and Australia, strong business connections are already in place. Available positions in those countries include IT professionals and engineers, but most workers enter the countries on internships or temporary jobs.


BY KIM JI-YOON [jiyoon.kim@joongang.co.kr]




Job-hunting Koreans should look overseas

Southeast Asia"s finest "new" heritage hotels



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Singapore’s Capella hotel, today. It has four heritage-listed buildings set alongside its newer buildings.


Singapore’s Capella hotel was once the Royal Artillery Officers’ Mess, seen here in the 1950s.


The 32 original buildings that now house the all-suite Amantaka once formed Luang Prabang’s old provincial hospital, whose first phase is estimated to have been constructed between 1901 and 1910.


You can’t go wrong with the lodging of choice for Queen Elizabeth II — she stayed at Carcosa Seri Negara during a Kuala Lumpur visit in 1987.


Thai restaurant Chon is one of four teak structures at The Siam that date back at least 150 years.


A colonial-style mansion built in the 1920s, the Belmond Governor’s Residence was once home to the ruler of Myanmar’s southern states.


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(CNN) — An impressive collection of hotels built more than a century ago in Southeast Asia — catering to a sudden wave of well-heeled globetrotters that cruised in when the Suez Canal opened in 1869 — still stands proudly today.


Incredibly popular among modern travelers in search of a side of history to go with their luxury digs, we’ve featured some of the top historic hotels here.


But in recent years, savvy hotel developers have been capitalizing on tourists’ craving for the classics by converting century-old buildings once used for other purposes into luxury accommodations, as well.


Staying in luxury hotels that have seen two world wars certainly adds to the fascination of a trip through the region, especially when you uncover some of the stories absorbed by their enduring walls.


Capella Singapore


Built: 1880s (colonial manors)


Formerly: British Royal Artillery


Capella Singapore has four heritage-listed buildings set alongside its newer construction.


Two colonial manors, dating to the 1880s, were once used to house officers in the British Royal Artillery based on Sentosa Island.


One of the Lord Norman Foster-restored buildings is allocated as part of the 111-room hotel; another forms part of the long-stay The Club at Capella.


The other two conservation buildings give the hotel its colonial white facade.


Built in the late 1930s as the Royal Artillery Officers’ Mess, they remain perched on the grassy knolls.


The library lounge above the lobby displays nostalgic photos of Christmas dances and New Year’s balls with revelers in all their 1950s glam.


Legend has it that before the British surrendered to the Japanese in 1942 during the Battle of Singapore, officers buried regimental silver in the grounds, where to this day it may still remain.


Capella Singapore, 1 The Knolls, Sentosa, Singapore; +65 (0)6377 8888; from S$780 ($623)


MORE: Great Singapore hotels for a staycation


The Siam, Bangkok, Thailand


Built: Before 1862 (Connie’s Cottage, Chon restaurant)


Formerly: Thai house of socialite Connie Mingskau


Four teak structures on the premises of Bangkok’s incredible The Siam hotel date back at least 150 years.


Three of them make up the hotel’s Thai restaurant Chon; the other is the signature suite, Connie’s Cottage.


All four houses once belonged to Connie Mingskau, Thai silk legend Jim Thompson’s confidante and one of the last people to see him alive at the Cameron Highlands before his disappearance in 1967.


Each house, at least a century old when bought, had to be dismantled, transported down the Chaopraya River and reassembled in its original location on Sukhumvit Road, where the likes of Jacqueline Kennedy and William Holden attended the socialite’s fabled soirees.


“Jim wrote a number and a letter in chalk on each piece of wall,” recalls Mary Anne Stanislaw, Connie’s granddaughter.


“I remember that my cousins, brothers and I erased a part of a giant ‘A’ and we were severely reprimanded by Jim.”


The Siam Hotel, 3/2 Thanon Khao, Bangkok, Thailand; +66 (0)2 206 6999; from 14,500 baht ($453)


Amantaka, Luang Prabang, Laos


Built: First decade of the 20th century


Formerly: Luang Prabang provincial hospital


The 32 original buildings that now house this all-suite hotel once formed Luang Prabang’s old provincial hospital, whose first phase is estimated to have been constructed between 1901 and 1910.


The hospital moved to new facilities in 2005, after which Aman Resorts took over.


With 10 of the buildings protected under UNESCO World Heritage regulations, under strict stipulations they were meticulously restored and turned into 24 luxury suites.


The hotel’s high ceilings, shady verandas and louvered doors reflect the town’s French colonial influences.


In addition to the luxuries expected of an Aman property — spa, fitness facilities, fine dining — there’s an onsite gallery showcasing the history of Luang Prabang.


Amantaka, 55/3 Kingkitsarath Road, Ban Thongchaleun, Luang Prabang, Laos; +856 (0)71 860 333; from $800


BelmondGovernor’s Residence, Yangon, Myanmar


Built: 1920s


Formerly: Home to the ruler of Myanmar’s southern states


The “newest” property on this list, the Governor’s Residence has another few years before it hits its official 100-year-old mark, but it’s still worthy of inclusion.


A colonial-style teak mansion built in the 1920s, it was once home to the British governors who ruled Myanmar’s southern states.


Located in Yangon’s Embassy Quarter and set in a gorgeous lotus pool-filled garden, the hotel has rooms of varying sizes, the largest being a two-bedroom suite.


For those with Orwellian “Burmese Days” visions, the fan-cooled verandas and teak armchairs of this heritage property don’t disappoint.


Unlike the fabled Strand, this Yangon luxury hotel has a swimming pool — a huge relief after a day of sightseeing in the dusty former Myanmar capital.


Governor’s Residence, 35 Taw Win St., Dagon township, Yangon; rooms from $260


Carcosa Seri Negara, Kuala Lumpur, Malaysia


Built: Late 1800s


Formerly: Official residence of British High Commissioners


Set deep in the city’s historic Lake Gardens, this heritage hotel — formerly an Aman Resorts property — was the official residence of all of the highest British representatives to the Malay States from 1904 to 1941.


That all ended with the 1941 Japanese invasion, when Carcosa became the Japanese Senior Officers’ Army Mess.


Eventually it was returned to the Malaysian government.


Rooms in this UNESCO World Heritage site are large.


The suites come with butler service.


Decor is in line with the hotel’s architecture, which combines neo-Gothic and Tudor revival influences.


With the exception of the LCD TV, you may feel like you’re on the set of a Merchant-Ivory film.


One of Carcosa Seri Negara’s highlights is English afternoon tea, served in the drawing room or on the wraparound verandah overlooking impressive gardens.


Carcosa Seri Negara, Taman Tasik Perdana, Persiaran Mahameru; +603 2295 0888; from RM990 ($311)







Southeast Asia"s finest "new" heritage hotels