Vinashin now the biggest debtor for many banks

Preliminary statistics show that the total debts incurred by the Vietnam Shipbuilding Industry Group (Vinashin) have reached 86 trillion dong and the interest the group has to pay annually is 10 trillion dong.

Vinashin has said that end-of-August salaries have been paid to workers, at an estimated cost of 200 billion dong. As such, the top priority in restructuring Vinashin, the giant economic group which has been bogged down in difficulties, has nearly been settled. Meanwhile, settling debts remains a headache. The total debts incurred by Vinashin have reached 86 trillion dong and the interests the group has to pay annually has reached 10 trillion dong.

How will Vinashin pay its debts?

Details of the debts have not been revealed yet. However, everyone knows that Vinashin has two debts, the $750 million Government debt (the Government issued international bonds and then lent them to Vinashin) and the $600 million Vinashin got from foreign sources in the form of commercial loans. In Vietnam, Vinashin borrowed money from ten big commercial banks, most of which are state-owned banks.

Analysts believe that it would be easier to deal with domestic loans, because the Government has instructed the Ministry of Finance and State Bank to create favorable conditions for debt settlement. As for the foreign loans, Vinashin has only one choice: paying debts when they mature.

At the Government’s regular August press conference, the Government Office said that most of the foreign loans borrowed by Vinashin are not due yet. Meanwhile, in early September 2010, the Government agreed to Vinashin’s proposal that part of the 2010 international bonds will be used to pay debts to French bank Natixis ($300 million).

The International Monetary Fund (IMF) has warned that the loans borrowed by Vinashin that are not guaranteed by the Government will not be counted on as public debts. However, the loans are considered the “unseen part of the iceberg.” This is a problem, because the public debts cannot be measured exactly. Meanwhile, the Government still has to bear the consequences.

Restructuring the apparatus

The plan to restructure Vinashin has four main tasks: re-organizing leadership; restructuring subsidiaries; examining Vinashin’s investment projects and financial capabilities; and assessing some subsidiaries of Vinashin before transferring them to other companies, such as the Vietnam National Shippping Lines (Vinalines) and the Vietnam National Oil and Gas Group (PetroVietnam).

Nguyen Quang Khai, Secretary of Vinashin’s Party Committee, said that the Politburo and the Government have assigned the Ministry of Interior Affairs and Ministry of Transport to consider new personnel and then submit the list to the Government for approval.

It is expected that a new list of members for the Board of Directors will be submitted in October, while every person on the board will be considered thoroughly by relevant agencies before the list is submitted to the Government.

Currently, Vinashin is still operating under instructions from the Board of Directors “inherited from the old Vinashin.” The only difference is that the Board of Directors has seven members instead of nine, because two of the members have been put into temporary detention.-Nguoi lao dong

Some appointments made

Nguyen Duc Than, Member of the Board of Directors, has been appointed as the Chairman of the Board of Directors of the Cai Lan Shipbuilding Industry One Member Liability Company, after To Nghiem, the former Chairman of the company, was put into temporary detention on September 18.

Luu Quyet Thang, appointed to the post of Chairman of Board of Directors of Hoang Anh Shipbuilding Industry Company, is a member of the Board of Directors.

Another member of the Board of Directors, Do Thanh Hung, has been appointed to become the Head of the Supervision Committee of Vinashin. He will replace Tran Van Liem, who was put into temporary detention on September 3.

Tags: Vietnam Shipbuilding industry, Vinashin