Four arrested, one at large, as Vietnam probes massive losses at state-run firm

TuoiTre

Updated : 06/20/2017 16:32 GMT + 7

Vietnamese police have initiated criminal proceedings against five people responsible for sending a well-invested state-run enterprise into steep losses, officers announced on Tuesday.

Four of the accused have been arrested on charges of “intentionally acting against state economic management regulations and causing serious consequences,” while one remains at large after fleeing the country in November 2016.

The fugitive is Vu Dinh Duy, former general director of PVTex, the operator of the US$325 million Dinh Vu yarn making plant in the northern city of Hai Phong.

Duy left Vietnam on October 22, 2016, under the apparent guise of overseas medical treatment, and has since remained nowhere to be seen.

The PVTex was developed by the state-owned PetroVietnam, the country’s oil and gas giant.

The other four arrestees are former PVTex chairman Tran Trung Chi Hieu, the company’s ex-chief accountant Vu Phuong Nam, Dao Ngo Hoang, former head of its trade department, and Do Van Hong, chairman and general director of the Kinh Bac Petroleum Construction and Investment JSC, another PetroVietnam subsidiary.

Police confirmed on Tuesday that they have yet to detect the whereabouts of Duy.

The Dinh Vu plant has been forced to temporarily close three times since beginning operations in May 2014. By the end of the same year, the facility had incurred VND1.08 trillion ($48.21 million) in losses.

Deficits had risen to VND1.73 trillion ($77.23 million) by March 31, 2015, when the plant had only managed to sell 23,000 out of the 32,000 metric tons of yarn it had produced.

According to a report the Ministry of Industry and Trade submitted to the government, the PVTex plant had been developed based on a feasibility study that contained a number of misestimates.

For instance, the feasibility study stated that the power cost for the facility was only around $4.69 million a year, whereas the real figure was $12 million. Similarly, the plant had to spend $11 million buying chemicals needed for production, against an estimate of only $500,000.

While the feasibility study suggested that the developer should be able to recoup investment eight years after the facility began commission, the latest calculation shows that it will take as long as 22 years and ten months to reach that mark.

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This entry was posted in Anti-corruption - Chống tham nhũng, Corruption - Tham nhũng, Governance - Công quyền, Hải Phòng and tagged , , , , by Trần Đình Hoành. Bookmark the permalink.

About Trần Đình Hoành

I am an attorney in the Washington DC area, with a Doctor of Law in the US, attended the master program at the National School of Administration of Việt Nam, and graduated from Sài Gòn University Law School. I aso studied philosophy at the School of Letters in Sài Gòn. I have worked as an anti-trust attorney for Federal Trade Commission and a litigator for a fortune-100 telecom company in Washington DC. I have taught law courses for legal professionals in Việt Nam and still counsel VN government agencies on legal matters. I have founded and managed businesses for me and my family, both law and non-law. I have published many articles on national newspapers and radio stations in Việt Nam. In 1989 I was one of the founding members of US-VN Trade Council, working to re-establish US-VN relationship. Since the early 90's, I have established and managed VNFORUM and VNBIZ forum on VN-related matters; these forums are the subject of a PhD thesis by Dr. Caroline Valverde at UC-Berkeley and her book Transnationalizing Viet Nam. I translate poetry and my translation of "A Request at Đồng Lộc Cemetery" is now engraved on a stone memorial at Đồng Lộc National Shrine in VN. I study and teach the Bible and Buddhism. In 2009 I founded and still manage dotchuoinon.com on positive thinking and two other blogs on Buddhism. In 2015 a group of friends and I founded website CVD - Conversations on Vietnam Development (cvdvn.net). I study the art of leadership with many friends who are religious, business and government leaders from many countries. In October 2011 Phu Nu Publishing House in Hanoi published my book "Positive Thinking to Change Your Life", in Vietnamese (TƯ DUY TÍCH CỰC Thay Đổi Cuộc Sống). In December 2013 Phu Nu Publishing House published my book "10 Core Values for Success". I practice Jiu Jitsu and Tai Chi for health, and play guitar as a hobby, usually accompanying my wife Trần Lê Túy Phượng, aka singer Linh Phượng.

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