Vinalines seeks public aid for restructuring plan

The Vietnam National Shipping Lines (Vinalines) has asked the Government to adopt preferential policies to help domestic shipping fleets overcome difficulties, according the online Vietstock newspaper. In a report sent to the Party Central Committee’s Economic Commission, Vinalines asked the Government to direct banks and credit institutions to extend its debt limit and reduce loan interest rates in an effort to help it successfully carry out the restructuring plan approved by the Prime Minister early this year.

Vinalines General Director Nguyen Canh Viet said he expected State-owned banks to lend floating capital to shipping businesses, which are facing difficulties, during the 2013-15 period.

For his part, Minister of Transport Dinh La Thang said in a recent question-and-answer session with National Assembly deputies that Vinalines had restructured a debt of 7.855 trillion VND (374 million USD) at the Vietnam Development Bank and 20.412 trillion VND (972 million USD) at other credit institutions.

Vinalines also proposed the Government reduce taxes, including value-added taxes and import taxes for ships, and exempt the value-added tax of 10 percent for shipbuilding projects which are designed for international maritime transport.

Raising market share

To increase its market share in transporting export and import goods for the Vietnamese shipping fleet, Vinalines has asked the Government to reserve the right of transport of import and export goods, which are the country’s natural resources paid by the State budget, for the national shipping fleet.

At the same time, it is necessary to exempt and reduce a number of taxes and fees at the country’s seaports until the maritime transport market has recovered.

Vinalines also asked the Vietnam Social Insurance Corporation to allow shipping companies to delay paying debts from social insurance, health insurance and unemployment insurance from 2012 and previous years.

“In the context of the world economy’s degradation, most ship owners have been suffering large losses. If there is no support from the Government, many companies will become bankrupt and incapable of refunding the banks,” said the report.

For example, Vinalines Rubi, with a loading capacity of 1,800TEU, suffered a loss of about 16,000 USD per day because payments for its freight were not enough to compensate for costs. Similarly, Inlaco Express earns about 5,000-7,000 USD per day, on average, while its daily costs have increased to 14,000 USD.

In spite of the many long-term difficulties and challenges, Vinalines reported promising signs from maritime logistics services, as nearly 32 logistics businesses have become profitable.