Pouring billions of dollars, collecting "bitter fruits"

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do ty do thu trai dang PVN is a unit with quite a number of inefficient investment projects abroad. Photo: collected

Oil and gas, chemicals are "bogged down"

Referring to investment abroad, Vietnam Oil and Gas Group (PVN) is a typical example. According to the report of the Ministry of Industry and Trade: Currently, PVN is participating in 13 investment projects abroad in the field of oil and gas exploration and exploitation. These projects are authorized by PVN for Petro Vietnam Exploration Production Corporation (PVEP). In which, only 2 projects have money flowing into our country or economical effectiveness, and they are from the efficiency of Nhenhexky with the investment of US$ 533.22 million (Russia), and the lot of 433a & 416b (Algeria) with contributing capital US$ 1.26 billion. PVN’s remaining 11 projects in other countries are ineffective. Even, some projects have had to halt deployment, and might lose large amounts of invested money.

Another typical project is Junin 2 in Venezuela. PVEP is the investor in this project (40% of capital) with Venezuela Oil and Gas Corporation (60%). The project has a total investment of more than US $ 1.8 billion for the first phase from 2010-2015. Currently, the project has been halted under the direction of the Prime Minister at the Notice dated December 2, 2013 of the Government Office. In addition, a number of other projects of PVN are waiting for transfer to other partners, such as lots 67 and 39 (Peru); lot PM 304 (Malaysia)...

Referring to "terrible" projects when investing abroad, the project of exploiting and processing Kali rock salt in Laos by Vietnam Chemical Group (Vinachem) is a name not to be missed. The project with total investment approved by the Ministry of Industry and Trade in 2013 was over US$ 522 million, equivalent to more than 10,000 billion dong. In which, the equity capital was US$ 104 million, the loan capital from Vietnam Development Bank was US$ 113 million, the commercial loan capital of the Government was US$ 262 million, and the unguaranteed commercial loan was over US$ 43 million.

A recent report by the Ministry of Industry and Trade referred to this project: "The project has a capacity of 320,000 tons/year, in which Vinachem is the investor, started construction in 2015 and temporarily stopped work in July, 2016. Currently, due to a sharp decrease in the price of potash salt, the project is not economically viable. The Party Committee of the Ministry of Industry and Trade has reported and proposed the Government Party Committee and Politburo to select a stop to be implemented for the project and develop a draft plan for project submission to the Politburo for consideration ".

Coal and minerals are no less efficient

In addition to PVN, Vinachem, Vietnam Coal-Mineral Industry Group (TKV) also contribute a lot of "bitter fruits" when investing abroad. The inspection conclusions at the Vietnam Coal and Mineral Industries Group (TKV) and a number of member units announced by the Government Inspectorate in April 2018 showed that: In the period of 2010-2015, with all the trillions of dong invested by TKV it did not promote efficiency, even might have lost all the investment capital, in which, there were many investments abroad. Typically, TKV invested in Southern Mining Co., Ltd., with US$ 4.39 million; contribution capital of 111.45 billion VND into Stung Treng Joint Venture Company for mining in Cambodia; contribution capital of 184,784 billion VND for a joint venture in Cambodia Alumina; contribution capital of 37.9 billion VND to Vinacomin Laos Co., Ltd., for salt mining; contributing 69 billion VND to the exploitation of Phu Nhuom iron mine in Laos... With TKV’s investment abroad, it did not promote efficiency, faced the risk of losing capital, and the Government Inspectorate has asked the Ministry of Public Security to take part.

Around the story of investment failures abroad, Dr. Nguyen Duc Thanh - Director of the Institute of Economic and Policy Research (VEPR) assessed: That showed the limitations of State corporations. "If looking for those responsible for losses, inefficient investment projects, of course, the corporate leaders who brought money in investment will be held accountable," Mr. Thanh said. However, Mr. Thanh also stated that in fact, an overseas investment project by state-owned economic groups must have consensus on the policy and appraisal in many places and many sides. Some projects invested by the State-owned corporations are under direction, so the quest for responsibility will not be simple when examining each project.

Vietnam put $US 6.2 million for outward investment VCN – According to the statistics from the Foreign Investment Agency – The Ministry of Investment and ...

Some experts believe that if maintaining the way of implementation under subjective thinking, and with limited vision, there will be many overseas investment projects facing difficulties and "covering up". Therefore, in the coming time, the story of investments abroad needs to be considered thoroughly, with a long-term vision, careful steps, and effectiveness placed on top.