Feature 3 | SE ASIA Debt puts Vietnam shipbuilding on hold


Vinashin’s crippling debts have put shipbuilding development progress back, possibly by more than four years, reports Sam Chambers.


last year its myriad non-core investments included a golf course and a brewery. Vietnam Shipbuilding Industry Corp


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(Vinashin) has been the darling of state-owned enterprises for much of the past decade. Its dramatic decline, saddled with US$4.5 billion in debts, last year caused acute embarrassment to Hanoi and now experts argue the financial debacle has set shipbuilding development back by at least four years. “It won’t be until at least 2015 until


confidence returns in any deals relating to Vinashin,” comments one classification society surveyor in Ho Chi Minh City. “For the time being,” he adds, “it’ll be local, oſten state run, shipping lines who’ll be ordering at Vinashin. Tey’ll be the guinea pigs in any new designs.” New designs, however, are unlikely,


says one Hong Kong-based shipbuilding consultant: “Vinashin is unlikely to branch out into anything new for a long time to come. First, they have to get back on a sound financial footing. Secondly, they have to up their quality and delivery schedules.” Financial woes continue. Indeed, in


November a Dutch creditor took Vinashin to court in London over its failure to pay any of its debts back. Vinashin is arguably the most high


profile of a host of state run enterprises that have hit hard times in the past 18 months. Despite much talk of revamping these state institutions analysts think these promised reforms will not fully materialise. Johanna Chua, an economist at


Citigroup in Hong Kong, noted in a recent report, “Despite escalating talk of divestment [of state-owned enterprises] and restructuring, we think strong vested interests and a weak global market backdrop next year will likely slow reforms.” Jonathan Pincus, Harvard University’s head of economics teaching programme


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t least Vinashin could organise a party in a brewery. As the full scale of its debt demise emerged


Vinashin may have to wait until 2015 when new World Trade Organization rules are enforced to kick-start its shipbuilding industry.


Foreign yards


While state-run Vinashin wallows in the mire there are a number of foreign yards that are progressing in the South East Asian nation. Established in 1996, Hyundai-Vinashin Shipyard (HVS) was a joint venture between Korea’s Hyundai Heavy Industries and Vinashin. It was originally a yard created to shift repair work from Hyundai Mipo but has since progressed into newbuilds.


Last year Hyundai-Vinashin repaired 28 ships and delivered four 56,000dwt bulk carriers for ER Schiffajrt and one 37,000dwt bulk carrier. In area space it is one of the biggest shipyards in the region. Following its takeover of Europe’s Aker Yards three and a half years sprawling STX Group, also of Korea, gained a foothold in Vietnam. Based in the south in Vung Tau the small yard is focused on offshore support vessels and has two 3000dwt anchor handling tug supply (AHTS) vessels on its books plus a pair of 2500gt platform supply vessels. Adding to the foreign mix this year Japan-based Oshima Group announced it is planning to build a new shipyard costing some VND3800 billion (US$184.6 million) in Cam Ranh City. Oshima has secured a 304 hectare site and construction of the yard will commence in 2013 with a view to an opening in 2017. Oshima says the yard will focus on bulkers in the 37,000 to 56,000dwt range, not dissimilar to its highly acclaimed vessel types on offer in southern Japan at present.


The Naval Architect January 2012


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