12 loss-making projects of the industry and trade sector owe more than 63,300 billion VND
By the end of June, 12 projects of the industry and trade sector owed more than 63,300 billion VND, with accumulated losses of more than 26,300 billion VND.
The Government has just sent a report on the implementation of the National Assembly's Resolution on supervision and questioning in the field of Industry and Trade. The report wasMinister of Industry and TradeTran Tuan Anh, authorized by the Government, said that up to now, the economic damage data of 12 projects has not been fully determined, so the settlement and determination of the value of the projects have not been completed.
The reason is that 5 projects are still in dispute, stuck in EPC contracts (Engineering, Supply of Technology Equipment and Construction Contract). These 5 projects include: Lao Cai DAP Fertilizer Plant No. 2, renovation and expansion project, Ha Bac Nitrogenous Fertilizer Plant, Ninh Binh Nitrogenous Fertilizer Plant, Dung Quat Shipbuilding Industry Factory and the second phase production expansion project of Thai Nguyen Iron and Steel Joint Stock Company.
However, according to estimated data for the first 6 months of the year, the equity of 12 projects was -7,264.61 billion VND. Total assets were 59,152.88 billion VND. Meanwhile, total liabilities were 63,308.82 billion VND, accumulated losses were 26,360.88 billion VND.
To solve difficulties in projects in particular, and in manufacturing industries such as iron and steel, fertilizer, fiber... in the country in general, the Ministry of Industry and Trade has used trade defense tools. This has helped projects such as DAP Fertilizer Plant No. 1 - Hai Phong, Vietnam - China Steel Company, Thai Nguyen Iron and Steel Joint Stock Company... gradually maintain the market and improve business situation.
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| Workers produce nitrogen fertilizer at DAP-1 Hai Phong Factory.Photo: DAP. |
At the end of 2019, the project had a total debt of more than VND 3,014 billion, short-term receivables of VND 4 billion. PVcomBank has sued Vinapaco, requesting the court to force Vinapaco to pay VND 592.3 billion. Currently, Vinapaco is facing financial difficulties and cannot guarantee payment of principal and interest, so this lawsuit may result in the project's assets and inventories not being auctioned as directed by the Government. The Ministry of Industry and Trade is presiding over and helping PVcomBank and Vinapaco review and negotiate settlement.
Previously, on August 19, the Steering Committee for Project Handling agreed to report to the Prime Minister to remove three projects, namely DAP-1 Hai Phong, Phu Tho Biofuel and Binh Phuoc Biofuel, from the monitoring and handling list. The corporations, general companies managing and investors of these projects will be fully responsible for handling them, ensuring compliance with legal regulations. The State Capital Management Committee will monitor the handling process of the corporations and general companies in these projects.
The Prime Minister, in July, requested that the projects be completed in 2020. If it has to be delayed, it should not take more than the first half of 2021.
12 loss-making projectsof the industry and trade sector including: DAP Fertilizer Factory No. 1 - Hai Phong; DAP Fertilizer Factory No. 2 - Lao Cai; Ninh Binh Nitrogen Plant; Ha Bac Nitrogen Plant Renovation and Expansion Project; Thai Nguyen Iron and Steel Phase 2 Expansion Project; Dung Quat Shipbuilding Industry One Member Limited Liability Company; Viet Trung Steel Plant Project; Dinh Vu Polyester Fiber Plant Project; Dung Quat Biofuel Plant Project; Binh Phuoc Biofuel Plant Project; Phu Tho Biofuel Plant Project; Phuong Nam Pulp Mill Project.
The total initial investment of these projects was nearly 43,700 billion VND, after adjustment to more than 63,610 billion VND (an increase of nearly 46%). Of which, equity capital was over 14,350 billion VND (about 23%), loan capital was over 47,451 billion VND (75%), the remaining nearly 2.9% from other sources. Of the total loan capital, the amount from domestic banks was over 41,801 billion VND, the rest was government-guaranteed loans.