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Vinashin's Development Bank loan extended
The Government green-lighted a plan that will extend the loan payment period for Viet Nam Shipbuilding Industry Group (Vinashin).
According to the Government Office, a new dispatch signed by Deputy Prime Minister Nguyen Sinh Hung said the Government agreed with the Ministry of Finance's proposal to extend the loan payment period for export credits. Vinashin has failed to make payments on a loan that was provided by the Viet Nam Development Bank.
The group will now have less than two years to repay the loan.
According to the dispatch, Hung said Vinashin had to review their plans for production and business. The group must also find partners who will be willing to purchase the ships built for previous clients who backed out of their contracts after Vinashin began experiencing financial difficulties.
In May 2010, chairman of Vinashin's board Nguyen Ngoc Su said the group's total debt was VND86.6 trillion (US$4.1 billion).
The company's debts was invested in several construction projects and partially built vessels.
After handing over these vessels to the National Oil and Gas Group and Viet Nam National Shipping Lines, the group's debt now stands at VND63 trillion ($3 billion).
Vinashin has 130 existing shipbuilding contracts worth $ 2.1 billion, of which 57 will be exported and 73 are being built for Vietnamese clients.
The Government published Dispatch No. 2611/VPCP-KTTH last month after receiving proposals from the Ministry of Finance, Ministry of Industry and Trade, Ministry of Transportation and Ministry of Planning and Investment.
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