By Thu Nguyet - The Saigon Times Daily

HCMC – A number of enterprises are hesitating to boost investments due to increasing input costs when power prices rise, said Cao Tien Vi, chairman of the HCMC Young Business Association (YBA).

Vi told the Daily on Tuesday that many local businesses last year had started to make plans to strengthen their investments and production this year with optimism on the economic recovery.

They have reconsidered these plans on fear that production costs will increase when power tariffs surge as well as petrol and material prices, Vi said. Uncertainty about loan stability also has local enterprises worried, he added.
Vi, who is also chairman of Saigon Paper Corporation, said the company’s input cost would increase 4% this month when power prices rise. A new factory of the paper manufacturer in Ba Ria-Vung Tau Province is expected to start production this year after a delay due to the global economic crisis.

The impact of higher energy prices will be heaviest on manufacturers and lighter on trade and service companies and ones with ample capital, said Vi. Therefore, a number of companies said they were continuing their investments, especially in property. In a meeting of YBA’s executive board last week, Bui Ta Hoang Vu, president of the HCMC Committee of the Vietnam Youth Union, said he knew that many local enterprises were investing into many projects this year.

Nguyen Thu Phong, chairman of Nha Vui Architecture Construction JSC, told the Daily he was investing in a resort project in Lang Co, Thua Thien Hue Province this year. Thanh Cong Mobile Phone JSC plans to open a real estate exchange this month, said its chairman Nguyen Quoc Bao. ROBOT Co. Ltd. also has investment plans this year. “We are going to invest in office buildings,” said company president Nguyen Phuong Nam.

The YBA has 800 enterprise members trading in many different industries.