News on 5 July 2016

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1) Vietnam province demands $180 mln from Formosa for mass fish deaths

Fishing boats in Quang Binh Province have stayed on shore for the past three months following the mass fish deaths in April. Photo: Quoc Nam/Tuoi TreFishing boats in Quang Binh Province have stayed on shore for the past three months following the mass fish deaths in April. Photo: Quoc Nam/Tuoi Tre

The Taiwanese company has pledged a compensation fund of $500 mln for the toxic spill disaster in four provinces. Quang Binh, one of the four provinces in central Vietnam hit by a toxic spill disaster in April, has demanded Taiwanese steel firm Formosa pay at least VND4 trillion ($180 million) to recompense for the devastating impacts on its environment and economy. The claim was made soon after the company admitted it was responsible for mass fish deaths in Quang Binh and three other provinces. The province's officials said at a meeting Monday (July 4) that the disaster, possibly the biggest environmental crisis in the country’s history, has caused losses of nearly VND2.7 trillion (US$120 million) to its salt, fishing and tourism industries as of last week. It is likely that the total damage could reach $180 million by the end of the year, they said, as cited by Tuoi Tre newspaper. The waters off the province have been heavily polluted and more than half of the local's seafood resources have been destroyed, they said, adding that some sea creatures "have almost disappeared." There is also a seafood safety scare across the country and it will be very difficult to recover from this, they said.

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2) Vietnam’s 2016 exports seen rising 8 pct, below target a 2nd year

Vietnam is likely to miss its export target for a second straight year in 2016, according to comments by the trade minister quoted on Monday (July 4). "If we proactively explore new markets and potential, apart from boosting exports to traditional markets, it is likely that exports could achieve a growth of more than 8 percent this year," Industry and Trade Minister Tran Tuan Anh was quoted by the Vietnam Economic Times newspaper as saying. Vietnam's target this year for exports, the driver of its economy, is 10 percent growth. That was also the target for 2015, when exports expanded only 7.9 percent. For the first half of 2016, exports were estimated at $82.24 billion, up 5.9 percent from a year earlier. The pace of annual economic growth slowed to an estimated 5.52 percent, from 6.32 percent last year, the government has said. Difficulties are still expected in the global economy and trade in the second half of 2016, Anh was quoted as speaking at a cabinet meeting on Friday (July 8).

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3) Vietnam asks Big C to fulfill tax responsibility before making managerial adjustments

Vietnam’s General Department of Taxation has requested local tax agencies in 20 locations. Big C has operations in to ensure that the supermarket chain has fulfilled tax liabilities before renewing its business license or changing its legal representatives. Two months after the finalization of a massive deal that sees it transferred to a Thai owner, French-owned supermarket chain Big C Vietnam is in dispute with the local tax authorities over the tax liability on a 1 billion euro (US$1.14 billion) sale. On April 29, Thai conglomerate Central Group announced it had acquired Big C’s operations in Vietnam, including 32 outlets countrywide, from France's Casino Group. According to Vietnamese law, parties involved in this type of transfer must declare and pay taxes within ten days of an agreement being reached. Vietnam is expected to collect VND3.6 trillion ($160.71 million) in tax from the transfer, according to the General Department of Taxation. However, two months after the deadline, neither Casino Group nor Central Group, which paid an enormous 1 billion euros to acquire 32 Big C outlets across Vietnam, has taken any step to fulfill their tax obligations. Despite this, the entities set up to manage some of the Big C Vietnam stores have already made, or are in the process of making, managerial adjustments.

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4) Asian shares step back as investors ponder stimulus outlook

A pedestrian stands to look at an electronic board showing the stock market indices of various countries outside a brokerage in Tokyo, Japan, February 26, 2016. REUTERS/YUYA SHINOA pedestrian stands to look at an electronic board showing the stock market indices of various countries outside a brokerage in Tokyo, Japan, February 26, 2016. REUTERS/YUYA SHINO

Asian shares stepped back after five straight days of gains on Tuesday (July 5) as investors took stock of a rally driven by the hope that central banks will provide stimulus to offset a likely downturn triggered by Brexit. MSCI's broadest index of Asia-Pacific shares outside Japan dipped 0.1 percent, but was still within reach of its June 9 peak, having risen more than 6 percent from its low after the Brexit vote. Japan's Nikkei dropped 0.5 percent. Financial and commodities markets in the United States were closed on Monday for Independence Day. In Europe, the FTSEurofirst 300 index fell 0.6 percent, snapping its four-day winning streak, led by a 1.6 percent decline in bank shares. Shares in Italian banks, saddled with a mountain of bad loans, dropped 3.7 percent after Italian Prime Minister Matteo Renzi's spokesman said the country had no plans to pump public money into its banks, a move that could be seen as defying EU rules. Overnight the price of precious and base metals hit multi-month highs before giving up gains as traders bet on more stimulus. Silver held on to its big gains over the past few sessions to trade at $20.35 per ounce. It has risen 11.5 percent in the three sessions to Monday (July 4). Gold also hit a two-year high of $1,357.40 per ounce and last stood at $1,350. The price of copper and aluminium hit two-month highs while lead hit a five-month peak.

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5) Exit stage right: UKIP leader Farage announces surprise departure

The leader of the insurgent right-wing UK Independence Party said on Monday (July 4) he was stepping down after realizing his ambition to win a vote for Britain to leave the EU, the latest twist in a dramatic reshaping of the nation's politics. The departure of brash former commodities trader Nigel Farage would sideline one of the most outspoken and effective anti-EU campaigners from the debate about how to sever Britain's ties with the other 27 countries in the bloc. But it could also give his UKIP party - which under Britain's winner-takes-all election system won just one seat in Parliament last year despite capturing 12.6 percent of the vote - an opportunity to select a less-polarising figure and take on the mainstream in a radically altered political environment. The June 23 'Brexit' vote to leave the EU has thrown the two main political parties into disarray, with the ruling Conservatives seeking a replacement for Prime Minister David Cameron and lawmakers from the main opposition Labour Party voting to withdraw confidence in leader Jeremy Corbyn.

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(All the above News Items have been sourced from: Reuters, ThanhNien News, Vietnam Net, Tuoitre News)

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