MoIT grilled over ailing SOEs

On November 15, the ninister answered questions of National Assembly deputies regarding various problems, including the five ailing multimillion dollar projects invested in by companies where the state ownership is handled by the ministry.

Anh said that the projects failed because of market conditions. For example, the price of oil has fluctuated greatly in recent years, “causing the plants producing fiber, urea, and ethanol to become uncompetitive.”

Anh added that other reasons contributing to the current state of these five companies included the lack of capacity on the side of the developers and the project management units when they carry out the project and supervise the contractors.

He said that the MoIT is trying to point out who exactly is responsible for the failure. “The Government Inspectorate, the State Audit of Vietnam, and the Inspectorate of the Ministry of Finance have started investigation. The ministry will report the results to the National Assembly in the next plenum,” he said.

Regarding the future of these projects, the minister said that any solution will have to prioritise protecting the state capital as well as be appropriate to the market economy and current international commitments.

“We may sell or declare bankruptcy if needed. The government has asked relevant ministries and government agencies for a report. The ministry already submitted a report on the Thai Nguyen Iron and Steel project, Dinh Vu Polyester Fibre and Yarn and Dung Quat Bio-Ethanol Plant, so the government will make a decision soon,” he said.

He also said whoever is responsible may be sued and prosecuted.

The five failing multi-million dollar projects where the Ministry of Industry and Trade handles the state’s stakes are:

1. The VND7 trillion ($314 million) Dinh Vu Polyester Fibre and Yarn Plant invested by Vietnam’s state-owned oil and gas group PetroVietnam;

2. The VND2.2 trillion ($99 million) Dung Quat Bio-Ethanol Plant invested by Binh Son Refinery-Biofuel;

3. The VND8 trillion ($360 million) expansion of Thai Nguyen Iron and Steel plant Phase II, invested by Thai Nguyen Iron and Steel JSC;

4. The VND3 trillion ($134.5 million) Phuong Nam Pulp Mill invested by Transport & Industry Development Invesment JSC (Tracodi). In 2009, the management of the project was taken over by state-run Vietnam Paper Corporation.

5. The $667 million Ninh Binh nitrogenous fertiliser plant invested by Vietnam National Chemical Group (Vinachem)

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