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Vietnam Shipbuilding Industry Corp. (Vinashin)

Vietnam has more than 60 shipbuilding and maintenance companies. The Vietnam Shipbuilding Industry Corporation (Vinashin) was established in 1996. Since then, the domestic shipbuilding industry has moved forward. Most of the Navy's cruises and equipment is from Russia, some are from U.S., China. Larger transport ships of the Navy include the Truong Sa class ship which was built by the state-owned shipbuilding firm, VINASHIN.

Concurrently Vinashin has expanded its cooperation with foreign partners to acquire the latest technologies and thereby has not been afraid to accept foreign advisory services. The Vietnamese shipbuilding industry follows the "Korean and Japanese way" of developing shipyards and building ships. Vinashin has so started to upgrade its 30 existing factories in recent years. Specifically, it has started to modernize the facilities at seven shipyards (Nam Trieu, Ha Long, Bach Dang, Pha Rung, Ben Kien, the Saigon Shipbuilding Industry Company and the Saigon Shipbuilding and Marine Industry Company). Such development mainly is around the Haiphong area.

VINASHIN's shipbuilding operation has grown rapidly over the five years from the receipt of the first international order in 2000, followed by receipt of several international orders from major shipping companies. VINASHIN offers a wide variety of new building choice from bulk carrier, container ship, oil tanker, car carrier tho other custom made-to-order ships, all with sizes ranging from smaller sub-handy size to VLCCs. The year 2006 saw the launch of the first two 53,000 DWT vessels in the Ha Long Shipyard and Nam Trieu Shipyard.

The Group is continuing the implmentation of the plan of construction of new-typed ships with higher level of complexity underway, such as 4.900 and 6.900 unit car carrier to be exported to Israel and Norway. The year 2010 saw the delivery of car carrier 4,900 units Victory Leader in Ha Long shipyard for Ray Car Carriers. A number of multi-purpose cargo ships, for instance Japan, Republic of Korea, Great Britain, Denmark are being built in various ship-building yards of VINASHIN.

In February 2010, representatives of Vinashin Group and Cam Ranh Shipbuilding Company visited the Richard E. Byrd - a logistic ship of US Navy, which is being repaired in Cam Ranh shipyard since 19th February 2010. Mr. Bui Huu Sy, the Director of Cam Ranh thanked the Captain of the ship for believing in repair capability of Cam Ranh shipyard and committed the repair is completed in time with high quality. Mr. Jonathan Olmsted, the Captain of Richard E. Byrd also expressed his happy come to Khanh Hoa province and thanked the host for warming welcome as well as for making good conditions in repairing works. Both sides have exchanged presents and expressed the willing to further cooperation in future.

Vinashin came to the brink of bankruptcy in the summer of 2010 after amassing $4.4 billion in debts. This prompted Moody's Investors Service and Standard & Poor's to downgrade Vietnam's sovereign debt. In December 2010, the situation worsened when Vinashin defaulted on a $60 million loan repayment on a $600 million syndicated loan arranged by Credit Suisse. In response to the defaults by Vinashin, the Government issued a new regulation in January 2011 requiring all enterprises issuing corporate bonds under a Government guarantee to first have their plans appraised by the Ministry of Finance and approved by the Prime Minister. State shipbuilder Vinashin projected revenues in 2011 to soar 105 percent from 2010, to 21.14 trillion dong ($1.1 billion).

In 2010, a scandal at state-owned shipbuilder Vinashin, which nearly collapsed under debt of about U.S. $4.5 billion, sparked investor concerns over the management of the countrys other government-run firms. Vinalines took on many of Vinashins projects, but also allegedly mismanaged them. Following public outcry over the shipbuilder, the government admitted Prime Minister Nguyen Tan Dung had played a role in allowing the mismanagement of state-owned firms including Vinashin, but said the "shortcomings and mistakes" were not serious enough to warrant disciplinary action. In a well-publicized court case, nine Vinashin officials were given long-term prison sentences in 2012 for knowingly violating state regulations. Vietnam is ranked as one of the world's most corrupt nations, and graft is a top concern for many ordinary people, who see it contributing to the countrys continued economic problems.

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Page last modified: 16-01-2014 19:29:08 ZULU