Vinashin asks Vietnam's government for more loans to pay salaries

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State-owned shipbuilder Vinashin is seeking more concessional loans from the government in order to deal with their ongoing financial difficulties, the news website VnExpess reported.

The troubled company, which nearly went bankrupt in 2010 after accumulating huge debts, received loans of more than VND292 billion (US$14 million) at zero interest last year, VnExpress said, citing the Government Office.

The loans were provided by state lender Vietnam Development Bank under an instruction from the government and were used by Vinashin to pay salaries and insurance for its employees. According to VnExpess, the repayment duration for the loans was not to exceed 12 months.

Vinashin said in a report late last year that it still struggling to pay the salaries of its workers. Consequently, the shipbuilder has requested the government arrange for it to receive additional loans from the Vietnam Development Bank in 2012.

The company is currently being restructured in accordance with a government order to narrow its focus to exclusively ship building and repair contracts and cease all other activities.

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