Vietnam: Shipbuilding group loses contracts

State-owned Vietnam Shipbuilding Industry Group, also known as Vinashin, said about 15 percent of its contracts were canceled due to the financial crisis, causing many difficulties. The group didn’t give any details on the value of the canceled contracts. Vinashin said it is still a new company with limited investment capital, and a lack of funds was inevitable amid the economic downturn, especially when it had to keep the jobs of about 80,000 workers.
Vinashin said US$750 million worth of sovereign bonds lent to the shipbuilder and another loan of $600 million from Sweden accounted for 40 percent of its capital demand.
The group’s statement came after severe criticism about its performance. The shipbuilder was reported to be running up huge debts, with several projects behind schedule for months.
One of the projects, the 150,000 DWT (dead weight ton) floating oil storage depot and offloading unit FSO-5, has had its completion date rescheduled many times. It is now expected to be delivered to state-run PetroVietnam 15 months after the original deadline late last year.