Vietnam suspends Vinashin board members amid probe into financial problems

Vietnamese Deputy Prime Minister Nguyen Sinh Hung suspended two board members of Vietnam Shipbuilding Industry Group, a state-owned company that came close to bankruptcy this year, as part of an investigation.

Vietnamese Deputy Prime Minister Nguyen Sinh Hung suspended two board members of Vietnam Shipbuilding Industry Group, a state-owned company that came close to bankruptcy this year, as part of an investigation.

Tran Quang Vu and Tran Van Liem were removed from the board, Nguyen Xuan Phuc, chairman of the Government Office, which oversees implementation of state plans, said in a statement posted on the government’s website late yesterday.

The board is also considering the dismissal of Tran Quang Vu, chief executive officer, Tran Tuan Anh, Hanoi-based vice head of personnel at the shipbuilder, said by telephone today. The government statement said the prime minister had asked for Vu to stand down.

In July, Chairman Pham Thanh Binh was suspended from his post at Vinashin, as the company is known, as the government began an investigation into financial difficulties at the state- controlled company, which almost collapsed under 86 trillion dong ($4.4 billion) of debts.

Prime Minister Nguyen Tan Dung decided on the probe to review Binh’s “responsibilities and to investigate and clarify faults,” according to a statement on the government’s website on July 14. Deputy Minister of Transport Nguyen Hong Truong was appointed as the replacement chairman.

Vinashin doesn’t have enough funds for some projects after its customers and lenders were hit by the global recession that started in 2008, the Ministry of Transportation said July 1.

The company also over-diversified its businesses and didn’t manage its cash flow and debt properly, according to the transport ministry statement.

Nguyen Quoc Anh will be appointed acting chief executive officer of Vietnam Shipbuilding Industry Group tomorrow, he told Bloomberg News by telephone today. Anh is currently the state- owned company’s business manager. – Bloomberg

Tags: Vietnam Shipbuilding industry, Vinashin