Colliers Vietnam Q1 2014 Investment Report: Read and follow the top economic indicators for Vietnam, M&A activity, and major developments in finance, banking, and legal. Published Monthly with contribution from LNT & Partners Law Firm.

1. > Investment Digest
Vietnam Q1/2014
*Arrows indicate monthly, quarterly, or period-over-period trends as appropriate
**Data is accurate as reported on the indicated date
Market Snapshot
Trend Indicator January February March Date
10-year bond yield 8.90% 8.84% 8.70% 31-Mar
Credit Market -0.55% ytd -1.2% ytd +0.01% ytd 31-Mar
Deposit Rate 7%-9% 7%-9% 6%-8% 18-Mar
FDI -21.9% yoy to $0.3971b -62.5% yoy to $1.54b -49.6% yoy to $3.334b 20-Mar
FDI Disbursed +3.3% yoy to $0.465b +6.7% yoy to 1.12b +5.6% to 2.85b 20-Mar
Fitch B+ B+ B+ 26-Mar
GDP - - 4.96% 1-Apr
Inflation +0.69% ytd +1.24% ytd +0.8% ytd 28-Mar
Lending Rate 7-9% short, 9-13% long 7-9% short, 9-13% long 7-9% short, 8-13% long 30-Mar
IIP +3% yoy +5.4% yoy +5.2% yoy 31-Mar
Moody’s B2 B2 B2 26-Mar
Overnight Rate 3.37% 2.77% 1.70% 28-Mar
PMI 51.8 51 51.3 1-Apr
Refinance Rate 7% 7% 6.50% 28-Mar
Repurchase Rate 5% 5.50% 4.50% 28-Mar
Retail Sales +12.6% yoy +13.7% yoy +10.2% yoy 30-Mar
Standard & Poors BB- BB- BB- 26-Mar
Trade Turnover -10.8%/-14.6% yoy +12%/+17% yoy +14.1%/+12.4% yoy 27-Mar
VND-USD 21,053 21,085 21,079 1-Apr
VN-Index 504.63 586.48 591.57 31-Mar
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Q1 2014 | VIETNAM INVESTMENT DIGEST

2. Despite reform delays and credit stagnation, the economy
made solid gains in other areas. GDP growth in Q1 is the
highest since 2011, consumer confidence is the highest
since 2011, inflation continues to fall, the current account
is maintaining a healthy surplus, the Dong has maintained
stability to the dollar, while actually strengthening in
relation to other ASEAN currencies, and foreign trade
continues its double-digit growth – benefitting from
China’s aggressive geopolitical posturing and Vietnam’s
regionally competitive labor and energy costs.
Both stock exchanges advanced in Q1 with the VN-
Index gaining 17.25% and the HNX-Index 31.66%.
Foreigners led the advance due to a variety of factors
including an anticipated increase in foreign ownership
limits, China’s aggressive regional posturing, and the
destabilization of several emerging markets such as
Ukraine, South Korea, and Thailand.
We expect economic expansion to accelerate in 2015-
2017. Deleveraging will continue through into 2016, but
we expect domestic demand to rise in 2015 and help
shrink the output gap.
The investment environment is strongly favorable for
affordable and mid-income residential, and logistics
property; favorable for office and retail; and unfavorable
for high-end residential.
Q1 has been a quiet quarter with no surprises: Vietnam
is in a holding pattern of sub-7% growth – unable to
shake free the fetters of bad debt and a system mired
in lethargy and special interests. There has been
little progress in both of the two key drivers that was
mentioned in the last letter (Q4’13) - financial sector
reform and an overall deleveraging of both the public
and private sectors contributing to the large output
gap and underutilization. Vietnam seems to prefer slow
incremental changes resulting in missed opportunity
cost as it lags behind its ASEAN neighbors.
Circular 02, which promises to apply international
standards to debt classification and risk provisioning,
has been postponed once again to April 1st, 2015 from
June 1st, 2014. Circular 09 (Mar 18, 2014) will allow
banks to postpone certain provisions in Circular 02 in
hopes it will “soften” the blow to the banking sector.
While there is risk to the market in the form of credit
crunch and insolvency, this will once again extend
deleveraging and further flatten the recovery curve.
Vietnam is also focusing on reducing rates to spur credit
growth and investment. However, despite very dovish
policies, credit rose a negligible 0.01% ytd against the
year’s target of 12%-14%. Current indications point
to a lack of domestic investment appetite due to a
combination of high levels of debt and low domestic
demand. This has resulted in high levels of liquidity,
as evidenced by low interbank rates. For lack of better
options, banks have been parking the excess in g-bonds.
The State Bank of Vietnam (SBV) hopes that long-term
rates between 7%-9% (currently 9%-13%) will be the
catalyst necessary for sustained domestic investment
activity.
Manager’s Letter
KYNAM DOAN
Investment Manager
kynam.doan@colliers.com
+84 1223 128 032
2 Vietnam Investment Digest | Q1 2014 | Manager’s Letter COLLIERS INTERNATIONAL
VIETNAM INVESTMENT DIGEST | Q1 2014

3. Headlines
Central Bank Delays Circular 02 to Apr 1, 2015
In March, the central bank issued Circular 09/2014/TT-NHNN
amending Circular 02/2013/TT-NHNN on classification of debt and
risk provisioning at banks that will bring transparency and raise
risk management practices to international standard. Circular 09
will delay some of the major provisions of Circular 02 until April 1st
of 2015 in hopes of softening the blow of banking reform. Experts
expect NPLs to jump to 9%-15% from the currently reported 3%-
4% once the circular is enacted – potentially crippling credit and
leading to failures of weaker banks and businesses.
This latest delay follows a prior delay that pushed the execution of
Circular 02 from June 1st 2013 to June 1st of 2014. Reform of the
banking sector and reduction of NPLs will be further delayed and
continue to depress Vietnam’s growth.
VIETNAM INVESTMENT DIGEST | Q1 2014
3 Vietnam Investment Digest | Q1 2014 | Headlines COLLIERS INTERNATIONAL
Credit Rating Agencies & Corporate Bond
Information Center
The Vietnam Bond Market Association (VBMA) and the Ministry of
Finance are planning to set up a corporate bond information center
to educate the market, provide information about the primary and
secondary markets, and set up a yield curve.
Last year, the volume of corporate bonds sold was 34.41 trillion VND
(1.62 billion USD), a surge of 19.87 percent from 2012, 37.64 percent
against 2011 and 14.7 percent over 2010.
The Ministry of Finance as also submitted a framework for the
establishment of credit rating agencies and expects a decision
within the first or second quarters of this year. This will be key in
opening up the bond market to both domestic and foreign investors.
IPOs of State-Owned Companies Struggle
State-owned companies offered to sell nearly 304.5 million shares in
the first quarter, of which nearly 83.5 million shares, or 27.4%, were
sold. Local investors were most active, while foreigners bought only
10.1 million shares. Among the companies selling shares, most were
in public works in the property sector, which is still experiencing
recession with uncertain times ahead.
While equities are up 17% this quarter, foreign investors are hesitant
to purchase SOEs that are struggling and facing a mandate to
equitise – major headwinds contributing to these early struggles.
This will make it difficult for the government to meet its plan to sell
shares in 432 state-owned enterprises by 2015 - part of their major
initiative to restructure the state-owned sector away from non-core
activities.
ACV Prepares for Expansion of Tan Son Nhat
International Airport
Airports Corporation of Vietnam (ACV) is planning to expand Tan
Son Nhat International Airport in HCMC to expand capacity to 26
million passengers a year from the current 20 million. This expansion
is necessary while awaiting progress on Long Thanh Int’l Airport
in Dong Nai, which has yet to start. The airport’s annual capacity
reached 20 million passengers late last year, one year sooner than
earlier estimated, and is estimated to reach 25 million by 2016.
Passenger volume is expected to reach 30.3 million by 2020 and
53.4 million by 2030.
Such a move is also a strong indication that progress on the Long
Thanh Int’l Airport has stalled further. Vietnam Investment Review
recently reported that feasibility of the project was still under
discussion. The first phase would cost an estimated US$7.8 billion,
displace over 30,000 residents, absorb over 5,000 hectares of
currently growing cash crops
Over 18,000 new Companies Formed and
Over 16,000 Businesses Suspend or Closed in
Q1/2014
The Ministry of Planning and Investment (MoPI) has reported
that 16,745 enterprises have closed or suspended their business
operation in the first quarter of this year. This is an increase of 9.6%
over the same period last year.
The MoPI also reported that 18,358 new companies formed worth
VND97,983 billion ($6.64 billion) of registered capital, rising 16.9%
in quantity and 23.4% in capital. Additionally, 4,622 enterprises
which had registered to suspend or close their businesses restarted
their operation, making a year on year rise of 48.9%.

4. 4 Vietnam Investment Digest | Q1 2014 | Headlines COLLIERS INTERNATIONAL
VIETNAM INVESTMENT DIGEST | Q1 2014
Headlines
Credit Stymied Despite Loose Monetary Policy
Lending grew by a negligible 0.01% against the end of 2013 despite
low rates that continue to fall. In March the State Bank of Vietnam
lowered its discount rate to 4.5% from 5%, refinance rate to 6.5%
from 7%, and repurchase rate to 5% from 5.5%. This rate of growth
falls short of government targets of 12%-14% for 2014 and only
reinforces the urgency with which NPLs need to be addressed. The
high liquidity is being shifted to public debt as banks are parking all
of this excess cash in government bonds.
Prime Minister Nguyen Tan Dung last month asked the monetary
authority to step up measures to lower lending rates. The determined
dovishness of the government and SBV will eventually lead to rising
inflation once the market begins to expand their balance sheets.
HCMC Office Sector
Over the first three months of this year, occupancy rate of Grade
A office buildings in HCMC increased slightly to 90.2% while the
median rentals gained 0.27% q-o-q. Average asking rent of Grade
B developments also gained 3.76% compared to negative growth in
4Q13. Grade B occupancy rate showed good movement - rising to
90.8% in last quarter.
Office leasing achieved the best market performance in Q1/2014
with an increase in both asking price and occupancy rate. The
main force drove Office leasing up was mainly relocating activities
whereas extension demand rose only slightly.
Gradual improvement in office demand is expected to happen as the
economy continues to improve in 2014. Future supply of Grade B in
the next 12 month is assured to be stable due to good construction
progress in many projects including Lim Tower 2 and Viettel Tower.
Grade A capacity will expand due to the completion of Le Meridien
SG and Vietcombank Tower.
BCG tags Vietnam as a “New Growth Frontier”
In a recent report, BCG touted the future growth prospects of
Vietnam, which will be buoyed by the ASEAN Economic Community
(AEC) free-trade pact that takes effect in 2015. The report covers
the growing middle and affluent class (MAC), consumer optimism,
and the upcoming consumption tipping point.
Vietnam has the fastest-growing middle and affluent class (MAC)
in SEA. Between 2012 and 2020, this population of consumers
will rise from 12 million to 33 million. Compare this to a two-fold
increase in Myanmar and Indonesia, and a 35% increase in Thailand.
More than 92 percent of consumers in Vietnam expect to live better
than their parents and expect their children to live better than
themselves. This level of optimism is among the highest recorded
across 25 countries surveyed in the past year and is significantly
higher than in China, India, and Indonesia.
In order to project the growth of consumers and their spending in
Vietnam, the CCCI analyzed population and income trends in nearly
1,400 districts and surveyed 2,000 urban consumers about their
purchases in 20 categories of consumer goods.
The CCCI generated consumption curves that showed the income
levels at which purchasing takes off for individual products and were
able to identify tipping points of accelerating consumption. (See
exhibit on right)
As is illustrated, with a rise of only about 60% in GDP/capita, Vietnam
will experience a consumption tipping point for many groups of
consumer goods. Identifying and segmenting Vietnam by GDP/capita
zones would be one possible approach to expansion and investment
strategy to capture markets shortly before tipping point. If this report
holds true, the window to enter Vietnam and take advantage of this
jump in consumption is within the next several years.
Source: BCG
Source: BCG

5. Vietnam Attracts Over 2.3M Tourists in Q1
The General Statistics Office (GSO) reported that Vietnam received
an estimated 2.33 million international visitors in the first quarter
of this year, a year on year increase of 29.3%. Of these, 1.4 million
people visited the country for tourism and resort, up 27.14% year-
on-year; some 391,508 people came for business, up 28.76%;
403,829 people came to visit their relatives, up 35.62% and the rest
of 128,819 people came for other purposes, up 36.23%.
Foreign visitors to Vietnam from all markets posted on year growth
in the period. In which, visitors from Hong Kong topped the list with
a 325.88% on year rise; Germany ranked second with 248.79%
growth; followed by Russia, China, and Cambodia with 55.22%
growth, 48.94% growth and 33.81% growth, respectively. The local
tourists also edged up in the first 3 months of this year, increasing
6.85% on year.
In 2014, Vietnam targets to receive 8 million oversea tourists, serve
37.5 million domestic tourists and earn VND230 billion ($10.8
million).
5 Vietnam Investment Digest | Q1 2014 | Headlines COLLIERS INTERNATIONAL
VIETNAM INVESTMENT DIGEST | Q1 2014
Headlines
M&A
>> Feb 2014: Kien A investment and service Ltd (developed
Imperia An Phu) acquired Park Residence (Phu Hoang Anh II)
project from Hoang Anh Gia Lai Group
>> Feb 23, 2014: Novaland Corp acquired three commercial
projects including Icon 56 Ben Van Don, Lexington Residence
district 2, Galaxy 9 district 4 with the total investment of $176mil
>> Mar 2014: Phong Phu home textile JSC merged with Phong Phu
Group, shares interchange, ratio 1:1
>> Mar 25, 2014: Sacombank’s shareholder meeting announced
thay they had approved the M&A plan with Southern Bank.
Retail Growth flat at 10.2% in Q1
Retail sales are up 10.2% y-o-y to US$33.24 billion according to the
GSO. Compare to an identical 10.2% y-o-y growth in Q1 2013.
The HCMC Retail Sector is now suffering from weak demand and
increasing vacancies resulting in downward pressure on rents. The
first quarter of 2014 saw downturn of all market segments. While
retail podiums saw no change in rent, both department stores and
shopping malls experienced rental fall for the third consecutive
quarter. The average rent of department store dropped by 1% while
that of shopping malls dropped 9% q-o-q.
Labor Demand Outstrips Supply
VietnamWorks published a report April 1st that showed 11% growth
in demand for employment while the labor force expanded only 8%.
The report shows a continued trend of significant imbalance of
workers with appropriate qualifications to meet demand for business
across a number of sectors. This is an unchanged trend where
training and education fail to meet the growing labor demand.
The fields with the highest recruitment demands include import-
export, information technology, business administration, industrial
production, customer service, sales and marketing and construction.
The fields experiencing the greatest need for qualified candidates
span accounting, production, IT, software, import-export, design and
architecture.
Vietnam Pushing New Stock Market Products
Expect major changes in the Vietnamese stock market this year as
there are plans to merge the Ho Chi Minh Stock Exchange (HOSE)
and the Hanoi Exchange (HNX), both are finalizing plans to launch
exchange traded funds (ETFs) and derivatives, and 2013’s Decree
108/2013/ND-CP, which stipulates that joint stock companies that
start selling shares to the public must list within one year, is forcing
more companies to IPO.
The government hopes that the merger of the bourses and
proliferation of investment products will strengthen Vietnam’s
equities market and attract more domestic and foreign capital with a
broader range of products.
HCMC Residential
Sales moved briskly in Q1 with about 2,000 units sold. While the
trend is upwards in affordable and mid-end sectors, progress is
slow. There is a primary supply of approximately 15,300 units -
1,200 high-end, 3,700 mid-end, and 10,400 affordable units.
Uptake of the VND30 trillion affordable loan package remains slow
despite lowering the preferential rate to 5% and extending terms to
15 years.

6. Economic Indicators
VIETNAM INVESTMENT DIGEST | Q1 2014
6 Vietnam Investment Digest | Q1 2014 | Economic Indicators COLLIERS INTERNATIONAL
GDP
Vietnam’s GDP growth in Q1/2014 reached 4.96%, an improvement
over the 4.76% pace in the same period last year and was at
the highest level since 2011. This is an encouraging sign, but still
underperformed the 5.2% forecast of Bloomberg’s survey of seven
economists.
Industry, which accounted for about 36% of GDP, grew 4.9% from
the same period a year earlier. Services, which made up 47% of
GDP, expanded 6%.
Trade
Total exports reached $33.35 billion for an increase of 14.1% y-o-y in
the first quarter while imports reached $32.34 billion for an increase
of 12.4% y-o-y resulting in a surplus of approximately $1 billion.
While values climbed, trade growth has slowed for both exports and
imports. Y-o-y growth in Q1 2013 for exports and imports was 19.7%
and 17.0% respectively.
As expected, FDI accounted for a lion’s share of the growth and
volume. FDI exports accounted for 62.3% of total and grew 18.9%
y-o-y while FDI imports accounted for 57.3% of total and grew
14.6% y-o-y. Domestic exports and imports grew 9.8% and 9.7%
respectively.
The United States (U.S) was Vietnam’s largest importer, buying
17.8% of Vietnam’s total exports, an increase of 22.9% on year; the
European Union (EU) ranked second with 17.7% of Vietnam’s export
values, up 7.5% on year; followed by ASEAN countries (up 6.5%);
Japan (up 17.8%); China (up 30.2%). In term of imports, more than
80% of Vietnam’s imported goods are from Asian countries, mainly
from China, ASEAN, Korea and Japan.
FDI
The total newly-registered and additional Foreign Direct Investment
(FDI) has fallen sharply by 49.6% to US$3.334 billion in the first
quarter of 2014 compared to the same period in 2013. However, the
total FDI disbursed has increased by 5.6% y-o-y to US$2.85 billion.
The processing and manufacturing sector ranked first in attracting
FDI with US$2.332 billion for 141 projects, accounting for 69.9% of
total FDI, followed by the real estate sector with US$288.3 million,
and the construction sector with US$226.7 million accounting for
8.6% and 6.8% respectively.
In the first three months, the Republic of Korea (22.9%), Japan
(12.4%) and British Virgin Islands (11.5%) led 32 countries and
territories investing in Vietnam. Q1’s FDI focused its attention back
to Southern region, Binh Duong drew the most with US$788.8
million, followed by Ho Chi Minh City and Dong Nai Province with a
combined proportion of 57.8% of total registered FDI.
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Typical FDI Projects Registered Q1/2014
Dai An Vietnam - Canada International hospital project at Hai
Duong, total capital registered at $225mil from Canada
Residential and Commercial project at Binh Thanh District, HCMC,
total capital registered at $200mil from HongKong
Worldon Vietnam project at HCMC aims to manufacture high-end
wearing apparel, total capital registered at $140mil from British
Virgin Islands

7. Inflation
After Tet, demand for consumer products tends to shrink, partially
explaining the 0.44% m-o-m fall in CPI in March. Inflation for the 1st
quarter of 2014 increased just 0.8% ytd and 4.39% yoy.
According to the GSO, CPI decreased across several major groups.
Among those groups, catering and relating services experienced the
highest decrease of 0.96% m-o-m with grain food -0.13%; foodstuff
-1.46%. Housing and construction material group followed with
a decrease of 0.74%. On the growth side, groups such as family
appliances; garments, hats, footgear; medicines; health services and
education grew at very humble rates, of 0.03% to 0.16%.
Currency Remains Stable
Vietnam’s Central bank set the U.S. dollar’s exchange rate at
VND21,036 in March , where it has remained constant for 9
months. Commercial banks are allowed to apply effective exchange
rates +-1% from the official exchange rate set by the central bank,
accordingly, the ceiling price for a dollar is VND21,246. By the end
of March, commercial banks raised dollar prices by VND5-10/dollar
either for bid or ask, offering at VND21,065-21,085/dollar for bid and
VND21,125-21,130/dollar for ask, respectively.
Last quarter the SBV forecast a 2% devaluation against the dollar
in 2014, but a combination of strong FDI disbursal, healthy trade
surplus, anti-dollarization policies, and high remittances have
continued to prop up the Dong. The currency will fall at most by 1%
this year - barring any major shocks to the system.
Index of Industrial Production Up 5.2% in Q1 2014
In the first quarter of the year, Index of Industrial Production (IIP)
grew by 5.2%, higher than the 4.9% over the same period in 2013.
Manufacturing and processing grew by 7.3%, the power generation
and supply increased by 9.2%, water supply and waste treatment by
5.7%, mining and quarrying fell by 2.9%.
New Orders Rise at Fastest Pace since Oct 13 (PMI)
Solid new order growth was recorded in March, with the rate of
expansion quickening to the strongest in five months. March’s PMI
of 51.3 was a slight improvement over February’s reading of 51.0.
It was a mixed report as input buying grew for seventh consecutive
month, inventory decreased, job creation decreased for the 1st time
since august 2013, input price rose as a result of shortages of raw
material, and output prices fell due to strong competitive pressures.
Economic Indicators
VIETNAM INVESTMENT DIGEST | Q1 2014
QUARTERLY investment DIGEST
This digest is published quarterly by Colliers Vietnam Investment Services, led
by Peter Dinning and KyNam Doan, with contribution from our legal partner,
LNT-Partners. We advise an asset portfolio that focuses on appropriate returns
to match diverse risk-return profiles. Our portfolio tracks a wide range of assets
including land, developments, and income-producing properties across all market
sectors - commercial, hotel, industrial, residential, and retail. Contact us to learn
more.
General Director
Peter.Dinning@colliers.com
Investment Manager | HCMC
KyNam.Doan@colliers.com
Investment Manager | Hanoi
Tung.Nguyen@colliers.com
COLLIERS INTErNATIONAL Vn
7 Vietnam Investment Digest | Q1 2014 | Economic Indicators

8. District 2 Will be new City Center
On 20 March 2014, the People’s Committee of Ho Chi Minh City
released Decision No. 1340/QD-UBND stipulating the management
of general urban projects for the new adjustment of the city
construction project until 2025.
This Decision provides that the current urban area of the city will
cover 13 districts: Districts 1, 3, 4, 5, 6, 8, 10, 11, Go Vap, Tan Binh,
Tan Phu, Binh Thanh and Phu Nhuan, these districts of which will
function as the city center (center of political, commercial services,
finance, culture and history). Meanwhile, the development of urban
area includes 6 districts: Districts 2, 7, 9, 12, Thu Duc and Binh Tan.
District 2 will now be a new city center area, while the remainder
will comprise urban areas of development and renovations.
Real Estate Business from other relevant laws such as the Law
on Housing and the Law on Land. Under the amendments, the
transactions to purchase, lease, sublease, etc. residential houses will
follow the provisions set out by the Law on Housing.
Secondly, the amendments will expand the scope of real estate
business activities for foreign organizations and individuals and
overseas Vietnamese. Accordingly, these subjects will have the
right to rent houses, build houses for subletting or lease land
with infrastructure for subletting. This can be seen as a move to
encourage foreign investors to invest in the Vietnamese real estate
market.
Thirdly, despite these advantages, the amendments are forecasted
to increase the scope of management of state agencies in real
estate investment and real estate business. It is expected that more
applications or processes for putting houses or construction into
business will be required (while the Law on Real Estate Business
requires the application to comprise construction permits or project
applications and construction drawing designs, the amendments will
require all of these documents to be submitted). This is likely a move
by the State to reduce the risk borne by purchasers and control
poor investments in the real estate sector. While the added layer
of security may be positive, it has the unwanted effect of creating
further difficulties and obstacles for foreign investors who wish to
implement their real estate projects.
Fourthly, while the 2006 Law on Real Estate Business required
the real estate business enterprises and individuals to sell, lease
and hire-purchase houses or construction works through real
estate transaction floors, the amendments do not mandate that
these transactions be carried out through real estate trading floors
(although it still encourages it). This change will provide alternative
avenues when real estate transaction floors fail to conduct their roles
in the real estate business market, as these floors can complicate
real estate business transactions and waste time of parties.
Ministry of Construction Endorses Unification of
Single Method to Calculate Area of Apartments
On 20 February 2004, the Ministry of Construction issued Circular
No. 03/2014/TT-BXD to amending Article 21 of Circular No.
16/2010/TT-BXD (which addresses Decree No. 71/2010/ND-CP
implementing the Law on Housing).
Once this Circular comes into effect, every housing contract of real
estate companies must be made into four copies: one to be kept
by the buyer and the other three to be used by the investors to pay
taxes and registration fees and to apply for the certificate of the right
to use land and own property on the land to the buyer. Furthermore,
the apartment purchasing contract must comply with the contents
of the sample contract in the appendix to this Circular. Any such
apartment purchasing contract that does not conform with this
sample contract in the appendix will not be recognized by law and
will not be useable for the purposes of applying for the land use right
and property ownership certificate.
Under Article 1.2 of the Circular, the area of the apartment to be
written on this certificate issued to the buyer will include the area
of the walls separating the rooms inside the apartment, the area of
the balcony and the loggia (if any). The area will not include the area
of the boundary walls of the apartment, the walls separating the
apartments, the columns and technical boxes inside the apartment.
This provision essentially creates a uniform method for calculating
the area of an apartment, which is a change from the two methods
that were previously applied in Article 21 of Circular No. 16/2010/
TT-BXD. The revision brought about by this Circular now brings it
in line with the provisions of the Law on Housing and Decree No.
71/2010/ND-CP. This revision is expected to resolve disputes that
have occurred recently whereby apartment buyers were required to
pay a higher price for apartments than was originally envisaged due
to the two different methods used by the investor and vendor (i.e., if
the investor calculated the area of the apartment from the middle of
the surrounding walls and walls separating apartments referred to
in Circular No. 16/2010/TT-BXD). The Circular will come into effect
on 8 April 2014.
VIETNAM INVESTMENT DIGEST | Q1 2014
8 Vietnam Investment Digest | Q1 2014 | Legal Brief COLLIERS INTERNATIONAL
Legal Brief
Draft Amendment to Law on Real Estate Businses
The Law on Real Estate Business was adopted by the National
Assembly and came into effect since 1 January 2007. In 2013,
the Ministry of Construction has drafted amendments to this Law
on Real Estate Business, which is expected to be adopted by the
National Assembly in 2014. These amendments bring multiple
notable changes to the real estate business. Among other things,
the below are key changes that we assess they are highly likely to
be passed:
Firstly, the amendments will distinguish the scope of the Law on

9. VIETNAM INVESTMENT DIGEST | Q1 2014
Legal Brief
Gold Market will be Managed More Tightly
On 28 March 2014, State Bank of Vietnam released
Circular No. 11/2014/TT-NHNN on the regulation of
carrying gold by individuals on exit or entry into or out
of the country. Accordingly, individuals cannot carry
gold ingots or raw gold material on exit or entry.
Also, individuals may only carry gold jewelry and fine
art under strict conditions. Upon entry or exit with
passports, individuals have to declare with customs if
they hold gold jewelry and fine art carrying amounting
to 300 grams or more.
For individuals entering or exiting with a laissez-
passer, gold will only be allowed if it will only be used
to satisfy the demand for jewelry. An amount of 300
grams or more must also be declared.
These actions can be seen as another step towards
the State Bank’s tightening of the management of the
country’s gold market.
The Circular will come into effect on 15 May 2014
and replaces Decision No. 1465/2001/QD-NHNN
issued by the State Bank on 12 September 2001.
Currently, individuals may carry up to one kilogram of
international standard gold when entering the country
but must declare such amount to customs as provided
under this Decision.
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relationships with retail investors,
banks, developers and high net
worth individuals in Vietnam and
throughout the Asia Pacific
>> Conduct initial due diligence
of interested parties prior to
negotiation
>> Assist/Conduct negotiation
through to completion of
divestment
9 Vietnam Investment Digest | Q1 2014 | Investment Services
Legal partner
LNT & PARTNERS is a leading full-service independently ranked local law firm in
Vietnam with offices in Ho Chi Minh City, Hanoi, Hong Kong, and San Francisco.
The firm is among Vietnam’s most prominent, representing a wide range of
multinational and domestic clients, including Fortune Global 500 companies as
well as well-known Vietnamese listed companies on a variety of business and
investment matters.
LNT & PARTNERS
Partner
Binh.Tran@LNT-Partners.com
Reach out to the Vietnamese
investment community. To contribute
to Colliers’ Investment Digest,
contact kynam.doan@colliers.com Contact: KYNAM DOAN kynam.doan@colliers.com +84 1223 128 032

10. Accelerating success
With more than 100 professionals in 2 offices in Vietnam, the team is market driven and
has proven and successful track record with both international and local experience.
From Hanoi to Ho Chi Minh City, we provide a full range of real estate services
• Research
>> Market research across all sectors
>> Market analysis, advisory, and strategy
• Valuation & Advisory Services
>> Valuation for land, existing property or development sites
>> Feasibility studies to determine NPV, IRR and highest & best use
• Office Services
>> Tenant Representation
>> Landlord Representation
• Residential Sales & Leasing
• Retail Services
• Investment Services
• Real Estate Management Services
• Corporate Services
• Industrial Leasing
The foundation of our services is the strength and depth of our experience.
COLLIERS INTERNATIONAL
HO CHI MINH CITY
Bitexco Office Building, 7th Floor
19-25 Nguyen Hue Street
District 1, HCM City, Vietnam
Tel: + 84 8 3827 5665
HANOI
Capital Tower, 10th Floor
109 Tran Hung Dao Street,
Hoan Kiem District, Hanoi, Vietnam
Tel: +84 4 3941 3277
This document/email has been prepared by
Colliers International for advertising
482
offices
in
63 countries on
6 continents
Accelerating success
About Colliers International
Colliers International is a leader in global real estate services, defined by our spirit of
enterprise.
Through a culture of service excellence and a shared sense of initiative, we integrate the
resources of real estate specialists worldwide to accelerate the success of our partners.
We connect through a shared set of values that shape a collaborative environment throughout
our organization that is unsurpassed in the industry.
Publication Coverage Frequency Content Availability
Research & Forecast
Report
Vietnam Cities Quarterly All market sectors Publicly available
CBD Report HCMC CBD Monthly Office, Retail, Hotel and
Serviced Apartment
Publicly available
Asia Pacific Office
Report
Asia Pacific in-
cluding Vietnam
Quarterly Office market Publicly available
Vietnam Property
Market Report
Vietnam cities Quarterly All market sectors On subscription
Development
Recommendation
Vietnam cities At request All market sectors On subscription
$2
billion in
annual revenue
2.5
billion square feet
under management
13,500
professionals
and staff
www.colliers.com/vietnam
Please contact, If you would like to recieve our other research reports
PETER DINNING
General Director
peter.dinning@colliers.com
+84 903 322 344
KYNAM DOAN
Investment Manager
kynam.doan@colliers.com
+84 1223 128 032