Vietnam telecoms chief supports end of monopoly

~ Le Vięt Nam, aujourd'hui. ~
The Vietnam News

Vietnam telecoms chief supports end of monopoly
HANOI - The state-owned Vietnam Posts and Telecommunications Corporation's (VNPT), which has a monopoly over most national telecommunications services in Vietnam, expects and supports moves aimed at introducing competition into the telecoms sector. VNPT's chairman of the board of management, Do Trung Ta, said that the timing of the country's telecom market liberalization should be carefully considered but hinted that an end to the company's monopoly is inevitable, in an interview with the Vietnam Investment Review last week.

The VNPT executive said that it is standard practice for developing nations to maintain monopolies in the telecom sector until a measure of economic development is achieved, and that will determine the right time to liberalize. While he said it was difficult for one telecom company to serve a nation of almost 80 million, he argued that new competitors should not be encouraged to develop their own networks until VNPT network capacity was used up. In the interview, Do Trung Ta said: "Other companies would need a long time to set up infrastructure and human resources. If they are allowed (to compete with VNPT), they should use our available network because its capacity as yet not entirely used up by VNPT. In this way, a lot of state money would be saved." Questioned about reducing high telecom charges to boost telecom activity in Vietnam, he said that the Vietnamese market cannot be compared with developed economies.

"They have developed their telecommunications networks over a period of 70 years. We will reduce the charges in the future when demand in the domestic market increases. Our branches in 43 cities and provinces are still experiencing losses and we still have to balance revenue over the whole sector."

By Adam Creed - Newsbytes - July 6, 2000.

Vietnam grants economic concessions to software industry

HANOI - Vietnam's Government last month signed into law measures aimed at prioritising the establishment and development of the nation's software industry over the next five years. Vietnam's Prime Minister, Phan Van Khai, signed a resolution in June, that will deliver a number of benefits to computer software enterprises operating in Vietnam.

Software products and services produced and supplied inside Vietnam are now exempt from value added tax (VAT), while software for export is tax-free and entitled to tax returns. Other tax benefits, credit procedures and special allowances for foreign investments also apply to software enterprises. In January, the Vietnamese Government directed state communications giant, the Vietnam Posts and Telecommunications Corporation (VNPT), to take the lead in developing the country's information technology sector. Deputy Prime Minister Pham Gia Khiem told VNPT to expand its computer software exports, saying that the company has not produced as much as demand in the region warranted.

VNPT's new software development company will have initial capital of 30 billion VND (US$2.13 million). It will be set up by VASC (Value Added Service Center) - an IT services subsidiary of VNPT. More recently last month, US-based computer giants Compaq Computer Corp. [NYSE:CPQ] and Intel Corp. [NASDAQ:INTC] joined with VASC to establish a Vietnamese electronic marketplace for local businesses. The B2B marketplace will be Internet-based, built on Intel hardware, and with software written by VASC.

By Adam Creed - Newsbytes - July 6, 2000.