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VIETFUND MANAGEMENT (VFM)

VIETFUND MANAGEMENT(VFM) VF1 Investment Fund

VF2 FundVF4 Investment Fund

Head Office:10th Floor, Central Plaza Office Bldg17 Le Duan Boulevard, District 1 Ho Chi Minh City, VietnamTel: +84 8 3825 1488 Fax: +84 8 3825 1489 Hotline: +84 8 3825 1480

Hanoi Branch:Unit 1208, 12th Floor Pacific Place Tower83B Ly Thuong Kiet Street Hoan Kiem Dist., Ha Noi, VietnamTel: +84 4 3942 8168 Fax: +84 4 3942 8169

Website: www.vinafund.com

MONTHLY UPDATESJuly 2009 VFM

VietFund Management (VFM) is aleading financial services and investment firm, offering a wide range of finanical services in managing investment funds and discretionary portfolio manage-ment to domestic and international investors.

In 2008, VFM focused on carring out Discretionary Portfolio Manage-ment service to our individual and institutional investors as well as national and international financial institutions. We have expertise and experience management team and offer professional solutions in this field.

Our experts maintain a close watchon market developments and actively adjust the composition of the investment portfolios to develop the appropriate invest-ment strategies that suit your needs. New opportunities are uncovered via our comprehensive research and deep market knowledge.

By entrusting the management of your assets to us, you can be sure your portfolio will be managed professionally – leaving you more time for yourself.

3INVESTMENT FUND

MONTHLY UPDATES JULY 2009 VF1

VIETFUND MANAGEMENT (VFM) VF1 I 2

Due to the adjustment effect of the both market in Ha Noi and Ho Chi Minh City, VF1 Fund obtains a slowdown in July trading activities. Total trading volume of VF1 certificates in July diminishes 0.78 times lower than in June, corresponding VND 406,238 billions. Even though the discount of the price and the net asset value has been improved in the last month, the discount rate still maintain around 42.45% in the last trading day of July.

INVESTMENT OBJECTIVEVF1 aims to invest to listed and unlisted shares, fixed-income securities and other financial instruments to build a balanced portfolio.

FUND INFORMATION

VF1 TRADING IN JULY, 2009

Fund name : Vietnam Securities Investment Fund (VF1) Custodian bank : Bank for foreign trade of Vietnam (Vietcombank)Fund type : Closed-end public fund Auditor : Ernst & Young Vietnam Ltd.Abbreviation name : VF1 Investment Fund Dividend : By annual, based on realized return and approved by Annual Meeting of Investors.Trading code : VFMVF1, listed at HoSE Fees : Management fee: 2%/NAV/yearCurrent chartered capital : 1,000 billion VND Custodian & depositing fees: 0.12%/NAV/yearPar value : 10,000 VND/fund unit Incentive fee (detailed in Fund Charter)Inception date : May 20, 2004Fund term : 10 years since inception date

MOVEMENT IN NAV

(*): based on weighted chartered capital

31/07/2009 PerformanceFund size (VND bn.)

NAV(VND bn.)

Unit NAV (VND)

1-month 3-month 6-month 9-month Since inception(20/05/2004)

VF1 1,000 2,272.3 22,723 7.7 29.3 35.8 33.3 127.2

VN-Index 4.1 45.1 53.9 34.5 78.4

HNX-Index 3.3 33.8 54.0 34.0

YTD

33.9

47.9

46.4 53.9

NAV PERFORMANCE(20/05/04 = 100)

In July, VF1’s NAV achieved a gain of 7.7% month-on-month thus reached 2,272.3 billion dong, or 22,723 dong/ fund certificate. On a year-to-date basis, VF1’s NAV rallied 33.9% and since-inception it’s performance is up 127,2%.

600

NAV VF1 VN-Index

100

0

200

300

400

500

07/0

4

11/0

4

03/0

5

07/0

5

11/0

5

03/0

6

07/0

6

11/0

6

03/0

7

07/0

7

11/0

7

03/0

8

07/0

8

11/0

8

03/0

9

07/0

9

NAV performance Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year-to-date

YTD annualized

2009

2008

2007

2006

2005

2004

0.6

(2.1)

31.0

1.2

0.6

33.9

(55.8)

46.1(*)

175.1(*)

25.2

1.6

64.9

(55.8)

46.1(*)

175.1(*)

25.2

3.2

(1.0)

(4.2)

15.2

4.7

(0.2)

(14.0)

8.8

(4.4)(*)

5.8

0.6

(9.7)

5.8

4.7

5.6

0.3

14.2

(2.1)

1.3

3.5

(0.2)

(1.4) (7.5) 4.5 8.6 10.7 8.4 7.7

(6.0) (15.0) (15.7) (9.0) (20.0) (4.2) 6.7

25.0 47.6 33.0 19.9 24.9 0.1 (3.5)(*)

6.0 14.7 10.3 33.5 4.0 3.2 (8.4)

0.04 2.4 1.1 (2.4) 0.2 0.5 0.2

1.0 (0.6)

VF1

VF1 IVIETFUND MANAGEMENT (VFM) 3

INVESTMENT PORTFOLIO

INVESTMENT BY INDUSTRIES (%)

Unit: % NAV31/07/200930/06/2009

Investing activities in July surrounded 4 sectors: Banks, Real Estate, Transportation and Retailing. As a result, these stocks’ proportions of NAV increase significantly during July 2009. The portfolio investment of VF1 as of July 31st, 2009 included 36 investments in which Top Four holdings (59.6% NAV) included:

Real Estate & Infrastructure (18.4%)

Banks (20.2%)

Materials & Resources (12.0%)

Food & Beverage (9.0%)

INVESTMENT FUNDMONTHLY UPDATES JULY 2009

• During July, VF1’s asset allocation changed materially when the listed stocks’ proportion increased 8.7% as the Fund implemented investment when the market corrected.

• OTC stock rebounded slightly, thus their proportion increased 0.7% in July 2009.

• Investing in stocks and bond in July let cash available reduced from 20.1% NAV (June 30 2009) to 7.7% NAV (July 31 2009).

Unit: % NAV

Convertible bondsOther investmentsCash & Other assetsListed stocksUnlisted stocks

30/06/2009 31/07/2009

24.8

7.7

48.9

3.6

15.024.1

11.7

20.1

3.9

40.2

Banks

Real Estate & Infrastructure

Food & Beverage

Energy

Materials & Resources

Transportation

Pharmaceuticals

Capital Goods

Retailing

Utilities

Technology Hardware

Convertible Bond

Other investments

Cash & Other assets

20.2

18.4

9.0

1.4

12.0

2.4

3.1

1.2

0.1

4.1

15.0

1.7

3.6

17.4

17.1

7.6

1.6

11.4

2.0

2.2

1.2

0.1

2.5

11.7

1.3

3.9

7.720.1

FUNDMONTHLY UPDATES JULY 2009 VF2



In July, when the market fluctuated it started to differentiate between good stocks and bad stocks, VF2 continued to prove it effectiveness. As a result, VF2’s growth rate was 5.6%, which outperformed both VN-Index (+4.1%) and HNX-Index (+3.3%).

Total net asset value as at July 31, 2009 hit VND669.4 billion, discounted VND293.6 billion (-30.5%) ex-dividend and VND244.6 billion (-25.4%) cum-dividend from par value.

INVESTMENT OBJECTIVE

MOVEMENT IN NET ASSET VALUE (NAV)

Although ACB convertible bonds and unlisted stocks did not perform very well in the reported period (with returns of -1,7% and +2.5% respectively), listed stocks, with the participation of HOM listed on HNX on July 9, has soared 55.5% on July, thus increasing the listed proportion of the portfolio, surging to 11.7%.

Due to this surge of both HOM (55.5% m-o-m) and AG. PPS (22.6%) in July, the two stocks that had the best performance in July were the Materials & Resources sector, increasing the portfolio’s proportion from 11.6% as at June 30 to 16.1% as at July 31, 2009.

Real estate & Infrastructure stocks with SJS increased 16.7% during July increasing its proportion to 14.4% at the end of July, ranking second after Materials & Resources in the Top five industries in terms of percentage of NAV.

Portfolio review

(*) Dividend for the period of 13/12/2006 – 31/12/2007 was paid in 05/2008

• Grasp high growth investment opportunities from equitizations of the state owned and private companies, in potential developing sectors and othernew investments, to build an optimal, diversified investment portfolio to attain the highest possible returns with a reasonable level of risks.

• Create added values to the portfolio by assisting in financial restructuring, management and competition capability enhancement of invested companies.

VN-Index HNX-Index NAV

190

160

130

100

70

40

10

12/0

6

03/0

7

06/0

7

09/0

7

12/0

7

03/0

8

06/0

8

09/0

8

12/0

8

03/0

9

06/0

9

NAV performance

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year-to-date

YTD annualized

2009 (2.4) (6.9) 24.3 45.3

2008 (3.0) (10.8) (11.1) (4.3)

8.8 8.0 8.3 5.61.9

(*) (20.8) (4.8) 2.8 7.4 (9.0) (10.8) (2.2) (0.2) (51.5) (51.5)

2007 12.0 11.0 2.2 (3.1) 2.2 (5.8) (1.8) (1.0) 6.6 15.1 0.1 (3.1) 27.2 27.2

2006 2.5 2.5 35.0

31/07/2009 Performance (%)Fund size

(VND billion)NAV

(VND billion)Unit NAV

(VND)1-month 3-month 6-month 9-month YTD Since inception

(13/12/2006)

VF2 963.0 669.4 6.951 5.6 23.5 27.4 21.4 24.3 (30.5)

VN-Index 466.7 4.1 45.1 53.9 34.5 47.9 (39.9)

HNX-Index 153.9 3.3 33.8 54.0 34.0 46.4 (37.3)


HOM listing on the 9th of July and additional investments in listed stocks during the month, assisted the proportion of listed stocks in VF2 to increase to 45.5% NAV (June 30, 2009: 35.4% NAV).

In July, VF2 concentrated on investing in listed stocks, the plan for the second half of 2009 was to make no divestment, expecting that the market will be favorable in the short and medium term. Consequently, cash available decreased from VND64.5 billion or 10.2% NAV as at June 30, 2009 down to VND40.7 billion or 6.1% NAV as at July 31, 2009.

Pharmaceuticals & Healthcare decreased 5.3% in the month and thus reduced its holding from 9.8% (June 30) to 8.8% (July 31).

The additional investment of 14.5 billion dong into Food & Beverage sector in July made its proportion increase from 1.2% (June 30 2009) to 3.2% (July 31 2009).

Investments in other sectors made little contribution to the portfolio’s overall performance. Materials & Resources, Real estate & Infrastructure sectors outweighed the rest in term of both proportion and performance in July.

Investment portfolio

31/07/200930/06/2009

Investment by industries (%)

35,4

Listed stocksUnlisted stocks

Convertible bondsOther investments

Cash & Other assets

Unit: % NAV

Majority of the investment in July was invested in Materials & Resources (VND8.9 billion) and Food & Beverage stocks (vND14.5 billion).

Divesting activities were delayed during July expecting that the market will rally in short and medium term. The investment portfolio of VF2 as at July 31st 2009 included 24 investments (June 30, 2009: 23), in 11 industries, in which Top five holdings (56.7% NAV and 60.4% of total investments) included:

Materials & Resources (16.1%)Real estate & Infrastructure (14.4%)Banks (12.1%)Pharmaceuticals & Healthcare (8.8%) Energy (5.3%)

FUNDMONTHLY UPDATES JULY 2009 VF2

Gain/Loss (%)

NAV(%)

1-month YTD

NAV growth (%) 5.6 24.3 100.0

Total investment growth (%) 6.0 25.3 93.9By listing status of

stocksListed stocks 11.7 33.6 45.5

Unlisted stocks 2.5 15.7 24.6

Top 5industries

Banks

Materials & Resources 30.7 44.4 16.1

Real estate & Infrastructure 13.1 52.0 14.4

Banks 1.8 71.1 12.1

Pharmaceuticals & Healthcare (5.3) 14.9 8.8

Energy (1.5) 1.9 5.3

31/07/200930/06/2009

16.1

14.4

12.1

8.8

5.3

4.6

3.6

3.2

1.0

1.6

0.47

22.3

0.6

6.1

11.6

13.4

12.6

9.8

5.7

3.7

4.4

1.2

1.1

1.7

0.50

23.5

0.6

10.2



Banks

Pharmaceuticals & Healthcare

Energy

Retailing

Food & Beverage

Capital Goods

Transportation

Utilities

Technology Hardware

Convertible Bond

Other investments

Cash & Other assets

Unit: % NAV

29.3

10.2

23.5

1.7

24.6

1.6

6.1

22.3

45.5

VF4


After a long strike in the market in QII/2009, July seems to portrait a strong adjustment in both Indexes. Trading activities of the whole market decreased evenly, whereas the total trading volume of VF4 certificates in July diminished almost five times lower than in June, corresponding VND 57,727 billion. The net asset value per unit in last July’s trading day was VND 8.400 dong, decreasing to almost 1.17% compared to last month, corresponding to around 5.89% and 2.23% growth of VN-Index and HNX – Index.

INVESTMENT OBJECTIVE

FUND INFORMATION

VF4 TRADING IN JULY, 2009

MOVEMENT IN NAV

Fund Name : Vietnam Blue Chips Investment Fund (VF4) Fund term : 10 years since inception dateFund type : Closed-end public fund Custodian bank : Hong Kong & Shanghai Bank Corporation (HSBC) – Ho Chi Minh City BranchAbbreviated name : VF4 Investment Fund Auditor : KPMG Ltd.Trading code : VFMVF4, listed at HoSE Dividend : By annual, based on realized return and approved by

Annual Meeting of InvestorsTotal chartered capital : VND 8,000 billionCurrent chartered capital : VND 806.46 billion Fees : Management fee: 2%/NAV/year

Custodian & deposit fee: 0.08%/NAV/year Incentive fee (detailed in Fund Charter)

Par value : VND10,000/fund unitInception date : February 28, 2008

In July 2009, the barometers of Vietnam stock market reached monthly gains of 4.1% (Hose) and 3.3% (Hnx). Consequently, the unit NAV of VF4 attained a value of around VND12,000, an increase of 7.6% compared to last month. This outperformed the growths of VN-Index and Hastc-Index approximately 1.8 times and 2.3 times, in the same period. As a result since it’s inception VF4 achieved a growth of 19.4%, whilst indices still possessed losses of over 30%.

VF4 aims to achieve long term capital growth with optimal risk through investing in IPOs of the big State Owned Enterprises and blue chips companies. These companies have shown consistent growth over the years, and are expected to sustain growth in the future.

INVESTMENT FUNDMONTHLY UPDATES JULY 2009


31/07/2009 Performance (%)Fund size (VND bn.)

NAV(VND bn.)

Unit NAV (VND)

1-month 3-month 6-month 9-month Year-to-date Since inception (28/02/2008)

VF4 806.5 962.7 11.937 7.6 29.5 41.9 37.1 40.0 19.4

VN-Index 466.7 4.1 45.1 53.9 34.5 47.9 (31.2)

HNX-Index 153.9 3.3 33.8 54.0 34.0 46.4 (33.8)

NAV performance Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year-to-date

YTDannualised

2008

(1.3) (9.0) 8.3 11.2 13.0 6.5 7.6 40.0 78.02009

(2.0) (0.9) (5.7) 0.4 6.3 11.5 (8.5) (12.7) (3.7) 1.7 (17.4) (17.4)

NAV VN-INDEX HNX-INDEX

30

50

70

90

110

130

02/0

8

03/0

8

04/0

8

05/0

8

06/0

8

07/0

8

08/0

8

09/0

8

10/0

8

11/0

8

12/0

8

01/0

9

02/0

9

03/0

9

04/0

9

05/0

9

06/0

9

07/0

9

INVESTMENT FUND VF4

VIETFUND MANAGEMENT (VFM)

MONTHLY UPDATES JULY 2009

VF4 I 7

In July 2009, the barometers of Vietnam stock market reached monthly gains of 4.1% (Hose) and 3.3% (Hnx). Consequently, the unit NAV of VF4 attained a value of around VND12,000, an increase of 7.6% compared to last month. This outperformed the growths of VN-Index and Hastc-Index approximately 1.8 times and 2.3 times, in the same period. As a result since it’s inception VF4 achieved a growth of 19.4%, whilst indices still possessed losses of over 30%.

INVESTMENT PORTFOLIO

INVESTMENT BY INDUSTRIES (%)

31/07/200930/06/2009

Four industries that enjoyed the most increase in NAV share were Banks – Diversified Financials (41.6%), Energy (37.0%), Materials – Resources (27.5%) and Food – Beverage (27.3%), in which top three investment of the month were Banks – Diversified Financials, Energy, and Materials – Resources, all represented 85.4% of total invest-ments in July 2009. Conversely, the increase in NAV weight of Food – Beverage industry resulted from the increase in market price of investment in the portfolio, especially VNM.

The investment portfolio’s of VF4 as at 31/07/2009 encompassed nineteen investments in nine industries, in which the top three (53.9% of NAV and 58.1% of total investment) were as follows:

Bank – Diversified Financials (23.8%),

Infrastructure – Real estate (15.5%),

Materials – Resources (14.7%).

31/07/200930/06/2009

Unit: % NAV

Listed stocksUnlisted stocksCash & Other assets

Banking & Diversified Financials



Food & Beverage

Utilities

Retailing

Pharmaceuticals

Energy

Transportation

Cash & other assets

Unit: % NAV

23.8

15.5

14.7

11.5

9.2

4.3

8.7

3.5

1.6

7.2

16.8

14.6

11.5

9.0

8.8

8.3

3.7

2.6

1.9

22.7

7.22.5

90.3

22.7

2.7

74.6

VIETFUND MANAGEMENT (VFM) ECONOMIC OVERVIEW I

MONTHLY UPDATES JULY 2009

ECONOMIC OVERVIEW

8

As mentioned in our 1H 2009 Economic reports, we believe that the world economy is showing signs of recovery from the present situation.. Many major indicators are pointing towards a significant improvement in many countries. The industrial production has increased while the tightening economic growth has been eased. The financial sector still faces trouble; however it showed more stable signs than the end of 2008. Many large and strong economic stimulus packages launched have previously started to show impacts furthermore having a positive effect on economic growth.

United States

The US economy showed more positive signs as its disposable income surged in the previous months, culminating in less stress levels. Many US banks started to have positive profits and consumer confidence also surged. The USD787 billion economic stimulus package as well as a series of massive lending programs helped revive the banking sector, which is experiencing the worst financial crisis since the Great Depres-

sion. At the end of QII/2009, the US economy posted a 0.3% contraction, much lower than many economists estimated. The government’s efforts to pull the economy out of a devastating recession were beginning to show signs of progress. We would hope that the US economy may pull out of the recession by the end of 2009.

WORLD ECONOMYUS GDP GROWTH

Europe

Source: Reuters, VFM estimate

US - UNEMPLOYMENT


US - REAL ESTATE MARKET


Với tỷ lệ giải ngân trong tháng 02/2009 vào ngành Cơ sở hạ tầng – Bất động sản và ngành Năng lượng chiếm tổng cộng 45,0% tổng giá trị giải ngân trong tháng, hai ngành này có tỷ trọng NAV tăng nhiều nhất trong tháng 02/2009. Ngành Thực phẩm – Nước giải khát mặc dù tỷ lệ giải ngân không cao (4,0% giá trị giải ngân tháng) nhưng do giá thị trường của cổ phiếu trong ngành này có mức sụt giảm thấp so với các cổ phiếu trong ngành khác nên tỷ trọng NAV của ngành cũng tăng so với tháng trước. Với giá trị thanh hoán chiếm 68,2% tổng giá trị thanh hoán tháng 02/2009, hai ngành Tiện ích công cộng và ngành Vật liệu – Khai khoáng có tỷ trọng NAV vào cuối tháng 02/2009 giảm so với tỷ trọng vào cuối tháng 01/2009. Danh mục đầu tư của Quỹ đầu tư VF4 đến ngày 28/02/2009 bao gồm 18 khoản đầu tư, tập trung vào 9 nhóm ngành, trong đó 3 nhóm ngành chiếm tỷ trọng lớn nhất (33,5% NAV và 48,4% tổng giá trị đầu tư) bao gồm:

Vật liệu & Khai khoáng (12,4%),

Thực phẩm & Nước giải khát (11,7%),

Ngân hàng & Dịch vụ tài chính (9,4%).

The Euro zone economy faced more difficulties; however some positive signals are in sight. The unemployment rate in Germany begun to ease, exports and industrial production is increasing. The euro-region economy didn’t have much movement in the QII as Germany and France unexpectedly returned to growth, suggesting Europe’s worst recession since the 1940’s is coming to an end. Germany’s GDP rose by 0.3% in the second quarter, bringing an end to the country's deepest recession and boosting hopes of recovery in the broader Euro zone. French GDP also grew by 0.3%.

GERMANY - CONSUMER CONFIDENCE INDEX


04/00 02/01 12/01 10/02 08/03 06/04 04/05 02/06 12/06 10/07 08/08 06/09

120

110

100

90

80

70

60

50

10/00 01/02

Million

04/03 07/04 10/05 01/07 04/08 07/09

4

3

2

1

0

%

10

8

6

4

2

0

No. of jobless cases Unemployment rate

06/06 01/07 08/07 03/08

Existing home sales (USD, RHS)

House price index (LHS)

10/08 05/09

230

220

210

200

190

180

1,400

1,200

1,000

800

600

400

200

0

03/0

1

12/0

1

09/0

2

06/0

3

03/0

4

12/0

4

09/0

5

06/0

6

03/0

7

12/0

7

09/0

8

06/0

9

8.0

6.0

4.0

2.0

(2.0)

(4.0)

(6.0)

(8.0)

2.8%

-1%

-6.4%

VIETFUND MANAGEMENT (VFM) I

ECONOMIC OVERVIEWMONTHLY UPDATES JULY 2009

9

Japan

China

In QII/2009, the Chinese economy expanded 7.9% y-o-y, as massive pump-priming and record lending pushed for a rebound from the worst growth in a decade, recent data showed that the investment contributed 6.2% of the GDP growth, and consumption shared 3.8%. Exports, which slid for eight straight months, dragged down growth by 2.9%. However there are still many obstacles to overcome in the current situation. Many countries are still facing high unemployment rates. The world trade posted strong contractions and many countries shifted their focus on domestic consumption and applied local stimulus packages as

well as limited trade activities. This was the expected risk that hinders the world economy recovery. As a result, many countries expanded their fiscal budget for the economic stimulus so that they could face fiscal deficit. This is turn could lead to the local currency devaluation in the short run. It is likely that the world economy will continue to remain low until the end of 2009 and we would expect it will recover strongly from 2010 and the year after. This is very much depending on the recovery of the US economy, especially its financial and real estate sectors.

The industrial production in June continued to surge 5.7% from last May. This was the fourth consecutive month of growth and helped ease its contraction over the same period last year. The strong recovery of industrial production in the last couple months also drove its economy out of the recession. Japan's economy returned to growth in the second quarter, pulling out of its longest recession since the 1940’s. Gross domestic produce grew 0.9 percent in April-June, slightly short of a median market forecast of 1.0 percent increase. That puts Japan in the first camp of G7 countries that have pulled out of recession, along with Germany and France.

CHINA - INDUSTRIAL PRODUCTION GROWTH (%)

06/04 02/0604/05 12/06 10/07 08/08 07/09

25

20

15

10

5

0

%

Source: Reuters, VFM estimate Source: Reuters, VFM estimate

CHINA - GDP GROWTH (%)

3

5

7

9

11

13

15

06/0903/0812/0609/0506/0403/0312/0109/00

%

JAPAN - INDUSTRIAL PRODUCTION


'000 billion yen billion yen

Industrial production (LHS)

No. of new orders (RHS)

65

75

85

95

105

115

06/0910/0802/0806/0710/0602/0606/050,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

ECONOMIC OVERVIEW



10

However there are still many obstacles to overcome in the current situation. Many countries are still facing high unemployment rates. The world trade posted strong contractions and many countries shifted their focus on domestic consumption and applied local stimulus packages as well as limited trade activities. This was the expected risk that hinders the world economy recovery. As a result, many countries expanded their fiscal budget for the economic stimulus so that they could face fiscal deficit. This is turn could lead to the local currency devaluation in the short run. It is likely that the world economy will continue to remain low until the end of 2009 and we would expect it will recover strongly from 2010 and the year after. This is very much depending on the recovery of the US economy, especially its financial and real estate sectors.

Source: Reuters

Stock market31/07/2009

31 Jul 2009 Vs 31 Dec 2008 Vs 29 May 2009 Vs 30 Jun 2009

US

Dow Jones 9,171.61 4.5% 7.9% 8.6%

S&P 500 987.48 9.3% 7.4% 7.4%

Nasdaq 1,978.50 25.5% 11.5% 7.8%

EU

FTSE 100 4,608.40 3.9% 4.3% 8.5%

CAC 40 3,426.27 6.5% 4.5% 9.1%

DAX 5,332.14 10.9% 7.9% 10.9%

Asia

Nikkei 225 (Japan) 10,356.83 16.9% 8.8% 4.0%

SSE (Shanghai) 3,426.27 87.4% 29.6% 15.3%

Hang Seng (Hongkong) 20,573.33 43.0% 13.2% 11.9%

TSEC (Taiwan) 7,077.71 54.2% 2.7% 10.0%

Kospi (Korean) 1,557.29 38.5% 11.6% 12.0%

Strait Times (Singapore) 2,659.20 51.0% 14.2% 14.0%

JKSE (Indonesia) 2,323.24 71.4% 21.2% 14.6%

KLSE (Malaysia) 1174.9 34.0% 12.5% 9.3%

VNIndex (Vietnam) 466.76 47.9% 13.4% 4.1%

HNXIndex (Vietnam) 153.91 46.4% 6.8% 3.3%

HNXIndex (Vietnam) Average gold price (USD/oz.)

934.16 14.5% 0.5% -1.1%

Oil price (USD/barrel) 64.29 64.7% 8.6% -8.2%

ECONOMIC OVERVIEW



11

VIETNAM ECONOMY

July FDI achieved 79 new projects with USD700 million.

July CPI continued to increase 0.52% m-o-m, slightly lower than 0.55% in June

At the end of QII/2009, GDP growth was at 4.5% which led to the significant recovery of the economic growth in the 1H 2009 at 3.9% after the slowdown in QI. With more confidence on the positive move of the world economy and its impacts on Vietnam, the Ministry of Planning and Investment has drafted the first version of the social-economic scenario in 2010. According to the first draft, Vietnam’s GDP will aim to achieve around VND1,960 – 1,970 trillion, approximately USD108 billion and GDP per capital be around USD1,220. The respective goals of agricultural, industrial and construction and service sector growth are 3-3.4%; 7-7.5% and 7.8-8.3%.

Total export value was aimed to grow 6% in comparison to that in 2009 and total development investment capital could be accounted up to 40.7% of GDP.

• With seventy-nine new projects (total registered capital of USD700 million) and thirty-seven existing projects with increased registered capital (USD500 million), total registered capital of FDI in July gained USD1.2 billion. This added up to a total of USD10.12 billion in the first seven months of 2009, however, this was just about 18.8% of that in same period of 2008.

• According to the stastistics from the Foreign Investment Department, there were only about 18% of total FDI aimed to real estate sector. Major FDI flowed in hospitality and restaurant sectors which accounted for 45%. The processing industry was ranked second with a 21% share.

• Total disbursed FDI capital as of 20th July was USD4.6 billion, only about 77.5% of that in the same period of 2008. In July, only about USD600 million was disbursed.

• With 0.52% m-o-m, the CPI in the first 7 months of 2009 increased to 9.25% in comparison to that of 2008. According to the statistics, the food and foodstuff category showed a slight drop at 0.05%. However the transportation and posted a strong increase of 3.05%, mainly due to impacts of the recent petrol price adjustment. We noted that the price of housing and construction material category returned its increase at 1.89% while the remaining goods categories posted a lower increase than the average CPI.

• We expect the inflation pressure to decrease at the end of 2009 as the recent measures to limit credit growth and cut interest rate applicable to the compulsory deposits of the commercial banks (down to 1.2%/year from 3.6%).

CPI (%)

Source: GSO

FDI (USD BILLION)

Source: GSO

01/0

8

03/0

8

05/0

8

07/0

8

09/0

8

11/0

8

01/0

9

03/0

9

05/0

9

07/0

9

MoM YoY

3.6%

2.1%

0.5 %

28%

19 %

3.0 %

7T/2009

2008

2007

2006

2005

4.610.1

11.560.3

8.020.3

4.112.0

3.36.8

Disbursed capital

Registered capital

ECONOMIC OVERVIEW



12

Both exports and imports surged slightly 1% m-o-m with respective total value of USD4.75 billion and USD6 billion

Industrial production continued its recovery with 2.3% m-o-m growth

The monetary policy was changed to limit credit growth and base rate was still kept stably at 7%

• Total export value gained USD 4.75 billion in July and posted an increase of 1% m-o-m. However, this was much lower than the growth in previous months (May – 3.2%, June 6.5%). With this amount, total export value in first seven months of 2009 was USD32.35 billion.

• Imports started to increase trend of value with respective months, April – USD5.46 billion; May – USD5.67 billion, June- USD5.9 billion and July – USD6 billion. At the end of July, total accumulated import value was up to USD35.73 billion.

• The increasing pace of trade deficit has come back as import growth gradually surpassed the export growth. At the end of July, total trade deficit was estimated at about USD3.39 billion and reached nearly 10.5% of total export value.

• According to the statistics from the Ministry of Industry and Commerce, the industrial production value in July gained VND59.1 trillion, continued to show recovery of 2.3% m-o-m and 7.6% y-o-y growth.

• Total accumulated industrial production value in the first seven months of 2009 posted an increase of 5.1% y-o-y with the amount of VND382.7 trillion. The Government will focus on pushing up industrial production in the ending months of 2009 to drive economic growth.

On the 17th July 2009, the SBV announced the new change of interest rate applicable to the compulsory deposit of the commercial banks. With this, the interest will be adjusted to only 1.2%/year from previous 3.6%/year. In addition, credit growth will be capped down to 25-27% from 30%. We see this move to control inflation and increase credit quality while the SBV not to tighten monetary flow as to continue support for the economic growth until the end of 2009.

TRADE BALANCE

Source: GSO

INDUSTRIAL GROWTH (YOY)

Source: GSO

INTEREST RATE VS INFLATION

Source: SBV, VFM compiled

25

20

15

10

5

0

5

4

3

2

1

0

-1

-2

06/05 12/05 06/06 12/06 06/07 12/07 06/08 12/08 06/09

Lãi suất tiền gửi (LHS) Lạm phát (RHS, MoM)

01/0

8

02/0

8

03/0

8

04/0

8

05/0

8

06/0

8

07/0

8

08/0

8

09/0

8

10/0

8

11/0

8

12/0

8

01/0

9

02/0

9

03/0

9

04/0

9

05/0

9

06/0

9

07/0

9

Export Import Trade balance

9

8

7

6

5

4

3

2

1

-1.00

-2.00

-2.30

-2.75 -2.85

-1.30

-0.80

-0.26 -0.24

-0.66

-0.43

-0.50

0.40

-0.10

0.40

-1.5-1.2

-0.5

01/0

8

02/0

8

03/0

8

04/0

8

05/0

8

06/0

8

07/0

8

08/0

8

09/0

8

10/0

8

11/0

8

12/0

8

01/0

9

02/0

9

03/0

9

05/0

9

07/0

9 Industrial growth (%.YoY)

20

15

10

5

0

-5

18.216.1 16.3

15.414.6

(4.4)

2.5

5.1

16.8 17.1

ECONOMIC OVERVIEW

Disclaimer: This Newsletter is issued by VietFund Management (VFM). This newsletter is aimed to provide information on net asset value (which have been approved by the Custodian) and activities of our funds. Besides that, other information are based on reliable sources at the time the news are released and VFM does not indepedently verified that all these statistics are totally adequate and exact. VFM is neither entitled to update, revise the newsletter in any kind nor inform readers in terms of opinion, forecast or estimation when there is changes.

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