Vietnam appoints new head of shipbuilding group

The Vietnamese government on Monday appointed a new acting head of the state-owned Vietnam Shipbuilding Industry Group (Vinashin), after suspending the previous head after less than two months in office for alleged mismanagement.

Nguyen Quoc Anh, the company’s chief business director, it to take over from Tran Quang Vu, who was suspended Friday to allow an investigation into Vinashin’s recent operations.

“The most important thing now is not who takes this position, but that the whole leadership of Vinashin unites and combines forces to solve its difficulties,” Anh told the local news website VnExpress.

Anh said earlier he believed Vinashin would be stabilised by 2013 and begin to turn a profit in 2015.

Vu’s suspension occurred less than a month after police arrested chair Pham Thanh Binh for alleged mismanagement that led the company to the brink of bankruptcy.

The government appointed Vu, the former chief executive officer of one of Vinashin’s top subsidiaries, chief executive of Vinashin on July 1, but media reports said Nam Trieu Shipbuilding Industry Corporation also got into financial trouble under Vu’s management.

Vinashin got into financial difficulties when it diversified beyond its core business and the global recession hit its revenue. This left the company unable to keep up with its debt repayments and resulted in salary cuts for more than 70,000 employees and the dismissal of 5,000 others, the government said.

As of the end of June, Vinashin had total assets worth 90 trillion dong (4.63 billion dollars) and debts in different currencies totalling 4.6 billion dollars, the government said.

Several economists have criticised the government for offering Vinashin unjustified state support, including a 750 million-dollar state loan in 2005 financed by a bond sale.

In a move to rescue Vinashin, the government last week asked local commercial banks to allow Vinashin to suspend payments on its debts and negotiated with international creditors. – DPA

Tags: Vietnam Shipbuilding industry, Vinashin