Vietnam inspects loss-making shipping firm

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G overnment inspectors Thursday began investigating fund and property management at leading shipping firm Vinalines, which announced big losses recently.


The 75-day inspection will cover Vinalines' long term investments initiated between the beginning of 2007 and the end of 2010.


Vinalines will be required to provide clear and adequate answers about their business operations to the inspectors.


A spokesperson for the State Inspectorate said that the inspection had been planned earlier.


But it was announced shortly after Vinalines reported losses of VND660 billion (US$31.67 million) in the first half of this year.


It's the first time the 15-year-old company has announced suffering losses, news website Dan Tri said Thursday.


Around a quarter portion of the loss was made by five businesses transferred from the state-owned shipbuilders Vinashin, which was driven to the edge of bankruptcy with debts totaling VND86 trillion ($4.4 billion) as of June 2010.


Nguyen Canh Viet, general director of Vinalines, said shipping businesses have been facing different problems over the past three years, mostly because of dropping fares.


Viet said that the shipping industry has never been in such a difficult situation ever, and a slight recovery last year has not made things better.


He blamed inconvenient weather conditions and more piracy in South Africa for worsening the situation and directly affecting Vinalines fleet.


Many Vinalines businesses investing in other maritime services have achieved good economic growth over the first half of this year, the general director said.


However, former minister of Transport Ho Nghia Dung said at a recent conference that Vinalines should not blame objective factors such as higher interest rates, increasing costs or inconvenient weather.


Vinalines businesses losing money in the first half this year have to study their management practices, Dung said.

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