Deputy Prime Minister requests to thoroughly handle Dung Quat shipyard

The Deputy Prime Minister requested that all parties thoroughly handle the Dung Quat shipyard. If it wants to operate again, it must have a convincing and feasible plan.

At the meeting on October 19, Deputy Prime Minister Le Minh Khai requested the Vietnam Oil and Gas Group (PVN), the State Capital Management Committee at Enterprises and representatives of ministries, branches and banks to agree on a plan to completely handle Dung Quat Shipbuilding Industry Company (DQS).

Deputy Prime Minister Le Minh Khai at the meeting on October 19. Photo: VGP.

Many options have been proposed, among which, restructuring Dung Quat shipyard to allow enterprises to continue production and business has received many consensus opinions.

According to a representative of the Vietnam Development Bank (VDB), allowing the factory to resume operations would be less damaging than bankruptcy and asset liquidation. However, the representative of this bank said that PVN and the State Capital Management Committee must come up with a "truly reasonable and legal" restructuring plan.

The representative of the Ministry of Finance also said that restructuring the factory is necessary, but DQS and PVN must work with creditors to agree on a plan to handle liquidated assets, ensuring harmony of interests.

Deputy Minister of Planning and Investment Tran Duy Dong said that for the DQS restructuring plan to be feasible, it is necessary to review the mechanisms and regulations on financial handling (related to principal debt, interest, and penalty interest). In case there is a good plan, the DQS restructuring plan and roadmap also need to be clarified.

The representative of the Central Economic Committee said that proposing a special mechanism to handle this factory is necessary, however, PVN needs to continue discussing with ministries and branches, proposing measures according to mechanisms that have precedents and are easy to implement.

Representatives of the State Audit and the Ministry of Justice, Public Security, Construction... also requested PVN to explain in detail the proposals for handling assets and finances in the restructuring plan, proving their effectiveness. At the same time, the Capital Management Committee also needs to direct PVN to clarify the contents that do not have a legal basis to seek opinions from competent authorities. Regarding the solution for handling assets, there must be detailed and specific arguments as well as an assessment of the potential for future development.

Concluding the meeting, Deputy Prime Minister Le Minh Khai said he was "not satisfied" that the proposed options were not clearly explained. He asked PVN and the State Capital Management Committee to explain and convince each option submitted to the competent authority.

"The spirit is that assets that cannot be exploited will be liquidated or temporarily frozen for later liquidation, ensuring harmonious benefits and sharing difficulties," the Deputy Prime Minister stated. According to him, if there is a feasible solution that solves the problem of financial handling, restructuring DQS is the best option.

Dung Quat Shipyard was handed over by PetroVietnam from the Shipbuilding Industry Corporation (SBIC, formerly known as Vinashin) in 2010 with a debt of nearly VND7,500 billion, nearly double the factory's charter capital (over VND3,750 billion). Although PetroVietnam poured nearly VND5,100 billion to pay off the debt and increase the charter capital, the factory is still in a state of financial imbalance and loss.

Since 2017, PVN has proposed to sell this factory, or else declare it bankrupt. If this factory goes bankrupt, PetroVietnam will not be able to recover the nearly 5,100 billion VND invested here. In addition, bankruptcy procedures are relatively complicated, lengthy and incur additional costs to carry out bankruptcy procedures. Moreover, liquidation of assets can be difficult and limited while the issue of ownership is resolved.

Quynh Trang

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