Vinatex was officially equitized in early 2015 with charter capital of VND5 trillion (roughly US$220 million) and the State ownership of 53.49 per cent, equivalent to VND2,675 billion (roughly US$118 million).
In accordance with the Government’s Decision No. 58 dated December 28, 2016, in the period 2016-2020, Vinatex is not a state-owned enterprise.
According to Vinatex, in order to increase its competitiveness in the global market, the Group has to offer high-qualified personnel suitable remuneration which is in compliance with the salary scale prescribed by the Government.
In addition, the Group must have the shareholders who have experiences in specialized management, market development and product sales.
Therefore, Vinatex proposes the Prime Minister (PM) to divest State capital of VND2,675 billion at the Group.
Mortgage of stocks for loans
Vinatex proposes the PM to allow using its stocks as collateral for loans from the Asian Development Bank (ADB).
Specifically, under the Agreement dated November 10, 2015 signed by and between the Vietnamese Government and ADB, Vinatex was provided by a loan US$105 million, of which US$100 is from ordinary capital resources and US$5 million from special one by ADB. This loan is under management of the Ministry of Finance (MoF).
Up to now, Vinatex has been disbursed only US$61 million due to collateral problems. The reason is that Vinatex has repeatedly proposed the MoF to use its stock as collateral; however, the MoF refuses its proposal. This will cause difficulties for the Group.
Vinatex proposes that the Government should apply separate policies and offer incentives on taxes and fees for Vinatex if the Group applies new, advanced and green technologies. At the same time, Vinatex will not make declaration and pay value added tax and special consumption tax on its redundant materials constrained within three per cent as allowed.
In addition, Vinatex asks the Government to offer the Group policies on supporting human resource training and reduce the social insurance premiums under the pressure of payroll, production and the increasing domestic and global competition, etc.
Vinatex is not the sole corporation asking the Government for incentives, tax reduction, separate mechanism, etc.. Particularly, to rescue the cement industry, in July, the Ministry of Planning and Investment asked the Ministry of Finance to consider and report to the Government to reduce the export tax on cement to lower than current applicable 5 per cent.
Recently, Vietnam Oil and Gas Corporation – PVN proposed numerous tax incentives for its project on Block B – O Mon gas pipeline with the total investment of US$ 1.2 billion.
"That the groups are offered incentives will make unbalance on the market economy. There are special incentives that can be offered in case the enterprises are in difficulties or bankrupt due to objective factors such as natural disaster," said Dr. Le Dang Danh, economic expert.