Decree declares state monopoly in 20 goods, services

Vision for Asia-Europe railway still dimLan Nhi HANOI – The vision to develop an integrated freight railway network across Europe and Asia to link Vietnam with the Eurasian Economic Union has encountered a slew of challenges. As the free trade agreement between Vietnam and the Eurasian Economic Union came into force last October, Kazakh Ambassador to Vietnam Beketzhan Zhumakhanov proposed developing a freight rail service from Vietnam to the union’s member states via China, and a Kazakhstan-Vietnam shipping route. The ambassador’s vision is to develop logistics services, thereby promoting goods trade between Vietnam and union members, as 90% of tariffs are cut. The diplomat had said then that the transport of containers by train from Hanoi via the Lao Cai border gate to Kunming-Nanning of China and then to Kazakhstan will take 18-20 days, compared to 40-45 days by sea. As such, goods via the rail service will see their competitive advantages rising. However, the limited trade volume between Vietnam and the Eurasian Economic Union can be seen a major hindrance to the development of the rail service. Data of Russian Railways shows Russia shipped more than 5,500 tons of goods to Vietnam, and imported around 326,000 tons from the Southeast Asian nation last year. Besides, the volume of goods from Russia to Vietnam was over 1,000 tons while the opposite direction was around 29,000 tons. Meanwhile, the respective figures for rail transit were about 169,000 tons and 770 tons. Russia is the largest market in the union, but its…... [read more]

At the two-day conference, representatives from China's Liao Zhou and Kunming Railway Departments, the Vietnamese Ministry of Transport and the two countries' relevant ministries and agencies focused on settling emerging issues relating to transport on the international railway route so as to ensure that the volume of transported goods match their railway infrastructure capacity. The signing of the Vietnam-China border railway agreement in 1992 and the reopening of the two countries' international railway route in 1996 have contributed to promoting their economic development. The volume of imported and exported goods on the railway has increased in recent years. In the past 11 months of 2006, the volume of Chinese goods imported to Vietnam increased from 847,000 tonnes in 2005 to 907,830 tonnes while that of Vietnamese goods exported to China rose to almost 360,000 tonnes. The total volume of imported and exported goods transported on the railway is expected to rise by 20 percent and the number of passengers using international railways is likely to achieve an 11 percent increase by the end of 2006.... [read more]

Local media cited Tran Ngoc Thanh, VRC Chairman , as saying that under the PPP mechanism, his corporation will be responsible for setting up transport infrastructure like unloading equipment, train stabling facilities, and warehouses at three stations Yen Vien (Hanoi), Dong Dang (Lang Son Province in the north), and Song Than (Binh Duong Province in the south). Meanwhile, private firms will be allowed to invest in facilities to serve the transport of goods by rail, focusing on cargo yards, storage, cargo-handling equipment, and warehouse management systems, Thanh said. Regarding business conditions, investors from the private sector can collect fees for the services they offer, based on a price frame approved by the state and the VRC, Thanh said. According to the chairman, the introduction of the PPP model in railway services will help change the current mindset of the industry: only VRC subsidiaries are allowed to join. "VRC subsidiaries have been favored when it comes to investing in those projects, but the situation will change. We are inviting investors from the private sector, and even allow them to buy trains to run on the railroads we built and use the associated services we are offering,”Thanh Nien (Young People) newspaper quoted him as saying at the meeting. He named some firms like Vingroup, Bach Dang, Indo Tran Logistics, and ATH Express Trains Ltd. Poor performance The existing mechanism only allows state-run firms to develop railway infrastructure and offer related services so the business performance of the rail sector has been so…... [read more]

Viet Nam News HÀ NỘI - The country's struggling rail transport sector continues to falter, with output and revenues of Việt Nam Railways (VNR) declining considerably, falling short of set targets. Đoàn Duy Hoạch, Deputy Director of the Việt Nam Railways (VNR), made the announcements on Thursday during the state-owned operator's conference on its business plan for 2017. The rail transport sector's revenue of VNĐ 8.338 trillion (US$367.6 million), was only 88.8 per cent of the target. Post-tax profit was estimated at VNĐ 137 billion ($6.04 million), while on-schedule train arrival hit 98.5 per cent. The corporation has carried out divestment in 30 companies worth VNĐ 204.3 billion ($9 million), bringing back VNĐ 404.91 billion (nearly $18 million) - two times the investment value. From 2014 to 2016, the corporation laid off nearly 11,000 personnel. Outdated railway infrastructure and insufficient quality of services were blamed for the sector's disappointing performance and failure to catch up with other modes of transport by Hoạch. "Mounting competition with other modes of transport, the Ghềnh Bridge collapse in Đồng Nai District, sea environment pollution, and storms and floods in the Central region all adversely impacted the corporation's business. In addition, limited budget for infrastructure development for 2016 delayed the implementation of new projects," he said. Nguyễn Ngọc Đông, Deputy Minister of Transportation - also in charge of the VNR's Board of Directors - said that last year, railway infrastructure didn't enjoy many upgrades, but restructuring which is expected to rejuvenate its business is scheduled…... [read more]

Five banks to remain 100% state-owned Lan Nhi HANOI - There are five banks on the list of 103 enterprises that will remain wholly owned by the State in 2016-2020, with three of them acquired by the central bank at zero dong for restructuring. Late last month, the Government released Decision 58 of the Prime Minister providing criteria for classification of State-owned enterprises (SOEs), those with State capital contributions and the list of SOEs to be restructured in 2016-2020. Compared to the previous five-year period, there are many changes to the list of enterprises where the State maintains ownership of 100% and more than 65%. Of the 103 enterprises where the State will keep whole ownership, 64 are operating in lottery, power transmission and regulation, production and trading of explosives, management of national railway and urban railway infrastructure, air traffic service and money printing. Among them, there are six credit institutions to remain wholly State-owned to ensure the policy and the safety of the banking system. They are Deposit Insurance of Vietnam, Vietnam Development Bank, Vietnam Bank for Social Policies, and the three banks that have been bought at VND0 in the past two years, namely Global Petrol Bank, Vietnam Construction Bank and Ocean Bank. In addition, the State decides to reorganize, float and hold a stake of 65% or more in airport and fly zone management firms, large-scale mining companies, oil and gas businesses, and those active in finance and banking (not including insurance, securities, fund management, finance and…... [read more]

HÀ NỘI - The domestic railway sector is urged to fix its current infrastructure weaknesses to raise the capacity of carrying passengers to at least 13 per cent and loading goods to at least 14 per cent by 2020 following Government targets. To reach the goals, Deputy Prime Minister Trịnh Đình Dũng, during his visit to several train stations in Hà Nội and then working with the Việt Nam Railway Corporation, tasked the sector to quickly upgrade its major railway stations. It was ordered to attract more investment capital from the private sector to connect the railway infrastructure system with domestic and even regional sea ports for conveniently transporting both passengers and goods, he said. Dũng said his requirements came after the domestic railway sector was found to be lagging behind, with loading capacity only meeting about 2 per cent of demand of passengers and goods compared to road and air travel. The current railway infrastructure system also failed to link with sea ports or major industrial processing zones, he said. Additionally, maintaining and repairing incidents on the railway was still slow and fatal railway accidents reportedly occurred mainly at level-crossings, he said. Dũng said the transport sector failed to point out a clear and consistent direction to develop the railway sector. According to the corporation, low investment to develop the railway sector was exacerbating the situation. Data from the corporation showed that investment for the railway sector only accounted for nearly 3 per cent of total investment for the…... [read more]

VietNamNet Bridge - The decline of the railway's popularity in Viet Nam is not new: back in 2010, the European Union labelled rail transport as the country's "least relevant" mode of transport. The issue was recently brought into sharp focus after Transport Minister Truong Quang Nghia claimed the booming air transport industry had "scooped up" all the customers of other modes of transportation, especially of the railway. However, the reason that rail use lags behind other forms of transportation in Viet Nam has more to do with weak infrastructure of the rail system, high overhead, expensive fares and loss of competitive edge. Dao Thanh Nga from Thanh Hoa Province worked as an accountant in Ha Noi and had to travel regularly to Dong Hoi City in Quang Binh Province - her husband's hometown. In the past she used the train because of its safety, given that travel time was the same as road transportation, taking about 11-12 hours. "In train stations, direction signs have been erected, carriage entrances and exits are on the same level as the station, making things easier. (Trains offer) clean beds, helpful staff, nice food catering services, and on-time departures and arrival. The whole journey takes nine and a-half hours. Train travel has really improved, shedding its 'outdated' clothes," Nga told VietnamPlus newspaper. However, those improvements are not sufficient to keep customers like Nga, who now prefers affordable flights that offer the same service quality but shorter travel time: flight plus airport procedures take just under…... [read more]

Viet Nam News HÀ NỘI - The decline of the railway's popularity in Việt Nam is not new: back in 2010, the European Union labelled rail transport as the country's "least relevant" mode of transport. The issue was recently brought into sharp focus after Transport Minister Trương Quang Nghĩa claimed the booming air transport industry had "scooped up" all the customers of other modes of transportation, especially of the railway. However, the reason that rail use lags behind other forms of transportation in Việt Nam has more to do with weak infrastructure of the rail system, high overhead, expensive fares and loss of competitive edge. Đào Thanh Nga from Thanh Hoá Province worked as an accountant in Hà Nội and had to travel regularly to Đồng Hới City in Quảng Bình Province - her husband's hometown. In the past she used the train because of its safety, given that travel time was the same as road transportation, taking about 11-12 hours. "In train stations, direction signs have been erected, carriage entrances and exits are on the same level as the station, making things easier. (Trains offer) clean beds, helpful staff, nice food catering services, and on-time departures and arrival. The whole journey takes nine and a-half hours. Train travel has really improved, shedding its 'outdated' clothes," Nga told VietnamPlus newspaper. However, those improvements are not sufficient to keep customers like Nga, who now prefers affordable flights that offer the same service quality but shorter travel time: flight plus airport procedures…... [read more]

Viet Nam News HÀ NỘI - The country has equitised 52 State-owned enterprises (SOEs) in the past 11 months, the Steering Board for SOEs Renovation and Development said. With the equitisation, the State sold shares worth more than VNĐ2.814 trillion (US$125 million) in book value for more than VNĐ5.086 trillion. The SOEs are mainly those owned by the Ministry of Industry and Trade, Ministry of Construction, Ministry of Transport, Việt Nam Rubber Corporation, and State Capital Investment Corporation (SCIC). In 2011-15, the country equitised, merged or closed down 591 SOEs, which was 96 per cent of the target, the steering committee said. However, the process of equitisation is facing obstacles because of incomplete legal regulations. To date, several ministries haven't submitted seven regulations related to equitisation to relevant authorities for approval as planned. To speed up the next round of equitisation, the National Assembly last month adopted a resolution that includes reform targets for SOEs in the 2016-20 period. The emphasis is on the SOE reform process becoming "faster and stronger" and the equitisation process becoming transparent, in line with the market mechanism. According to the resolution, SOEs that go through equitisation must list on the stock exchange one year before they can conduct an initial public offering (IPO) and attract strategic investors. The SOEs' loss-making investment projects will be set for bankruptcy. Nguyễn Trọng Dũng, deputy head of the steering committee, said that by 2020 the Government would fully retain only 190 of 718 SOEs in 12 vital sectors,…... [read more]

Vuong Dinh Khanh, former vice director general of the Vietnam Railway Corporation (VRC), said at a talk about railway development held by Giao thong (Transport) newspaper that for decades, the corporation – a major railway operator and service provider in Vietnam – desired to run 25 train pairs, but in fact operated just 18 train pairs, because infrastructure failed to meet required conditions. A double-track railway usually involves running one track in each direction, compared with a single-track railway where trains in both directions share the same track. “Current limited infrastructure hindered the sector’s development, weakened its competitiveness and posed risks to road safety,” he said. Khanh said it is time for Vietnam to seriously consider developing a double-track railway and funding the development, as the National Assembly is discussing amendments to the 2005 Railway Law, which came into effect on January 1, 2006, and has proven problematic and inadequate for current and future development of the sector. Nguyen Huy Hien, vice head of the Railway Department under the Transport Ministry said a major problem for the railway sector is that the VRC is managing, using and running the railway system, which is being funded by government. The railway system – a public asset –is also managed by the Transport Ministry, he said, implying an overlapping in management between the government body and the corporation. Hien said the railway bill needs to clarify roles and responsibilities of the parties involved. Moreover, the bill should be better oriented towards the market,…... [read more]




Links Topics : http://news.c10mt.com/2017/08/decree-declares-state-monopoly-in-20.html