Vinashin, bogged down in difficulties, is chased by creditors

In late 2007, Vinashin Chairman Pham Thanh Binh signed an agreement to invest in development of the Hai Ha Economic Zone into a $15 billion complex of shipbuilding yards and steel mills on the nation’s northeast coast. The Cai Lan Shipbuilding Company is the project investor and Vinashin Ha Long is the contractor.
Encouraged by Cai Lan’s promise that funds would be promptly transferred, Vinashin Ha Long (VSHL) hired sub-contractors to level the 5,000 hectares of the economic zone, says Nguyen Thanh Canh, General Director of VSHL.  Canh also knew, he said, that Credit Suisse Bank provided a $600 million loan to Vinashin for the project.
More than 3,000 workers worked hard to fulfill the contract. However, VSHL and its subcontractors still have not been paid for their work.
In his petition to the Prime Minister, Canh wrote: “We have been pushed to the wall.  We have become poor and miserable just because of the way the Cai Lan Shipbuilding Industry Company and Vinashin Group do business.”
Canh says that the ten companies that joined forces to clear the site have sent hundreds of documents to Vinashin to ask for debt payment.  They travelled to Hanoi many times to meet Vinashin’s leaders face to face in order to get, so far, only 36 percent of the contract’s value.
Canh told Tuoi tre newspaper that Vinashin still owes his company and the other nine companies 124 billion dong (about $669,000) plus penalties for late payment.
 “The Prime Minister instructed Vinashin to settle debts with the 10 companies in July 2009, but Vinashin’s leaders have so far only made promises,” Canh said.
 “The loans we took in 2008 to fulfill the projects have come due; some of the companies now have had to sell houses and offices to pay bank debts.”
 ‘Ambushes’ at Vinashin’s headquarter to demand debt payment
Vinashin’s headquarters on Ngoc Khanh street in Hanoi receives many ‘delegations of creditors’, in ones and twos and sometimes dozens. Quarrels sometimes erupt with the security officers of the building.  Some creditors went brought along their relatives, disable war veterans who threatened to stage a sit-in until Vinashin pays debts.
Pham Thi Thanh Tuyet, head of Thang Tuyet Company in Hai Phong, told Tuoi tre that she has not been able to meet Vinashin leaders though she came there many times. 
In 2008, she said, Thang Tuyet provided equipment to a Vinashin subsidiary, Vinashin Construction Company No 3, but she has not been paid. The process of ‘demanding for debt payment’ started in 2008 but by July 2009 Tuyet had received only 300 million dong out of 800 million dong due from Vinashin.
Among the creditors was a group of veterans from Ha Tinh province on the north central coast, headed by Cao Xuan Kiem.  Kiem related that in 2007 his Kiem Dung Company levelled the ground for the site of Nghi Son Shipyard, but the company has not got paid the 10 billion dong due it.  “We did not have much money. We are invalids, soldiers wounded during the war.  To borrow funds to undertake this work, we mortgaged our land use rights certificates,” he said.
Local authorities jump in, but they can help?
The fact that a company in Quang Ninh cannot recover debt from Vinashin is a headache for the  Quang Ninh People’s Committee as well.
On June 18, 2009, Quang Ninh authorities and Vinashin leaders met to discuss the lagging Hai Ha Economic Zone project.  The hot issue was Vinashin’s overdue debt of 150 billion dong to its subsidiary, VSHL. At the meeting, Le Loc, Vinashin’s General Director for Investment, said that it is still necessary to inspect the project on ground leveling.
However, Canh of VSHL did not agree. The project has been checked and taken over already, he insisted, and Vinashin’s proposal to inspect it is just another excuse for delay.
A top-ranking Quang Ninh official told Tuoi Tre that the next step will be to sue Vinashin for defaulting on the contract.