Vinachem took a USD250 million loan from China’s Eximbank in 2008 to carry out its Ninh Binh Nitrogenous Fertiliser project. The loan with a term of 15 years had a preferential interest of 4% per year.
Ninh Binh Nitrogenous Fertiliser Company
Put into operation since 2012, Ninh Binh Nitrogenous Fertiliser Company, which has a total investment of USD667 million, has incurred consecutive losses. So, by late March this year, Vinachem had only paid USD87.5 million of the total loan.
The Ministry of Industry and Trade asked the government for help in paying the remaining loan of USD162 million in the context of Vinachem’s current operation difficulties.
If China Eximbank does not agree to the late loan repayment, the Ministry of Finance has been asked to find ways to make the repayments.
Following the Ministry of Industry and Trade’s proposal, the Ministry of Finance said that the state budget deficit was high and many other projects are also seeking help due to their financial difficulties. So, Vinachem needed to raise their own finances to conclude the repayments.
The Finance Ministry also noted that negotiating with the Chinese bank on delaying the repayment would badly affect the Vietnamese government’s prestige.
After four years of operation, Ninh Binh Nitrogenous Fertiliser Company had made total losses of more than USD90 million.
