PM Chính Calls for Comprehensive Plan to Address Financial Challenges of Vietnam Airlines

Hanoi, The Gulf Observer: Prime Minister Phạm Minh Chính has directed relevant government agencies to formulate a comprehensive plan to address the financial difficulties faced by the national flag carrier, Vietnam Airlines. During a recent meeting with the State Capital Investment Corporation (SCIC), responsible for overseeing public investment in 19 corporations, the Prime Minister urged the SCIC to submit a detailed plan by the end of this month.

Vietnam Airlines reported substantial losses of VNĐ11 trillion ($458 million) in 2022 and VNĐ5.5 trillion in the previous year, resulting in accumulated losses exceeding VNĐ40 trillion. Although the airline’s business performance demonstrated improvement in 2023, the consolidated post-tax profit remained negative at about VNĐ5.5 trillion.

The national carrier has finalized a restructuring plan, currently awaiting review by shareholders and the Government. This plan encompasses asset restructuring and the issuance of shares to raise capital. Furthermore, the Prime Minister has instructed the Ministry of Finance to revise a decree on government investment, permitting Vietnam Airlines to divest its stake in Pacific Airlines.

Addressing the challenges faced by the carrier, the Prime Minister emphasized the government’s commitment to enhancing the operational efficiency of other State-owned corporations. PetroVietnam and Vinacomin have been directed to ensure an adequate supply of coal and gas for electricity production as the dry season approaches. Vietnam Electricity (EVN) has been tasked with creating plans to guarantee power supply during the upcoming dry season.

In addition, the Ministry of Industry and Trade has been instructed to establish a proper mechanism for managing petroleum business intermediaries and formulating appropriate electricity prices. The government will create favorable conditions and address legal issues related to taxes, land, real estate, and housing to facilitate the growth of State-owned corporations, Prime Minister Phạm Minh Chính affirmed.

The Prime Minister remains committed to addressing the financial challenges faced by Vietnam Airlines and ensuring the overall efficiency of State-owned corporations, marking a strategic move towards economic stability and growth.