According to Mr. Nguyen Ngoc Su, Chairman of the Management Board of the Vietnam Shipbuilding Industry Group (Vinashin), the group has a feasible plan to restrict its debts and the plan is scheduled to complete in 2014.
Su also said in a recent meeting that the debt restructuring process achieved some results.
“In the last two years, the group has carried out financial restructuring. To date, the debts basically are restricted and the debt restructuring plan will be completed by early 2014,” Su said.
On June 14, Deputy Prime Minister Nguyen Xuan Phuc told the National Assembly that Vinashin’s debts “greatly reduced” and from 2022, the group would begin paying debts.
Specifically, 19 domestic banks joined hands to reduce 70 percent of the debts for Vinashin. For foreign debts, the group has negotiated a 30 percent reduction. Previously, Vinashin was entrusted by the government to access to $750 million of foreign loans, along with $600 million in international bonds issued by the group in 2007.
However, Phuc said that Vinashin still incurred heavy losses so the restructuring should be performed more aggressively.
Vinashin’s restructuring plan has been submitted to the government, under which only eight core enterprises will be maintained. The other 216 businesses will be equitized or transferred and 166 companies without state capital will be sold or go bankrupt.
Recently, in the government’s June meeting, the government also asked relevant ministries to finalize the draft resolution on further restructuring Vinashin. At the same time, the Ministry of Transport was assigned to compile the solutions for restructuring this group. The plan will be announced in the appropriate time to not affect the handling of foreign debts.
According to the report of the Government Inspectorate, in late 2009, Vinashin’s total liabilities amounted to more than VND86.7 trillion and the actual losses was nearly VND5 trillion, VND3.3 trillion more than Vinashin’s financial statements.
At the Government Briefing in August 2010, Deputy Prime Minister Nguyen Xuan Phuc said that by 2014, Vinashin can earn profit again.