Dong Nai firms recovered quickly after riots

Thursday, Oct 23, 2014 08:19

As of the end of August, total tax refunds for 54 affected businesses had reached VND373.156 billion ($17.56 million), all of which have been disbursed. — VNA/VNS Photo

by Xuan Hiep

DONG NAI (Biz Hub) — Most enterprises in southern Dong Nai Province affected by the May riots sparked by China's placing its oil rig in the East Sea were able to resume business within a few weeks, and some expanded operations.

Mai Van Nhon, deputy chief of Dong Nai Province's Industrial Zone Authority (DIZA), said most of the affected companies had received support from the provincial administration.

More than 200 enterprises suffered damages, including property damage and theft, as well as delays in production, totalling VND376.8 billion (US$17.7 million). Of that number, about 80 businesses recovered on their own without help from the province, according to the provincial People's Committee.

Nhon said a number of companies had stepped up production to make up for losses, with four companies increasing investment capital by a total of $217.5 million. They include Amico Ltd, Kang Yuan Vietnam Ltd, Da Luen Vietnam Ltd, and Hung Nghiep Formosa Ltd.

Because of the disruption in business and damage to machinery, the Hung Nghiep Formosa Ltd Company suffered damages of VND103 billion ($4.84 million), followed by the Noroo Nanpao Ltd Company with a VND84.5 billion loss ($4 million).

While Johnson Wood Joint-Stock Company suffered damages of VND62.86 billion ($2.95 million), Advanced Multitech Ltd Viet Nam lost a total of VND45.38 billion ($2.13 million). The Viet Nam Center Power Tech Ltd Company recorded a loss of VND26.17 billion ($1.23 million).

Another company, Advanced Multitech, which has 2,000 workers, is recruiting more workers. "We need an additional 600 workers to meet production expansion," a representative of the company, who declined to be named, told Viet Nam News.

Shen Hsin Yuan, vice director of Perfect Vision Company, a Taiwanese firm based in Long Thanh Industrial Park, was quoted by the Vietnam News Agency as saying that he was still confident about the investment environment in Dong Nai Province.

"I hope the Government will continue to provide assistance to businesses," he said.

Meanwhile, Imamura Tomofumi, chairman of the Japanese Business Association in Dong Nai, said 32 affected Japanese companies in the province had resumed work soon after the incident.

Provincial aid

As of the end of August, total tax refunds for 54 affected businesses had reached VND373.156 billion ($17.56 million), all of which have been disbursed.

The Customs Department in Dong Nai Province has also simplified procedures for customs declaration for 34 of the affected businesses, and provided services during off-hours.

In addition, the Finance Ministry has worked with the province to advance insurance compensation worth a total of VND37.6 billion ($1.77 million) for the affected businesses, and has urged insurance firms to assess losses and damages so that claims can be made.

However, only three insurance companies, Bao Minh, PJICO and Cathay, have released information on compensation payments, according to DIZA.

The province has also waived and reduced land rental prices worth a total of VND12.8 billion ($602,496) for 19 enterprises that suffered damages worth more than VND1 billion ($47,070) each.

As for credit support, Techcombank Dong Nai has extended a loan-payment period to an additional three months for Center Power Tech (for a loan of $3.96 million) and has also provided a new loan of $349,400.

The An Binh Commercial Bank branch in Dong Nai Province has given the Vietbo Joint-Stock Company an additional month to pay back its loan of $355,420.

In addition, the State Bank of Viet Nam branch in Dong Nai Province has asked credit institutions and commercial banks in the province to consider giving foreign-currency loans to businesses so they can import machinery.


The province has petitioned the Government to allow it to provide a total of VND100 billion ($4.7 million) in loans to affected enterprises, with 50 per cent of the interest to be funded by the province's budget.

However, the province has yet to receive an answer from the Government, Nhon told Viet Nam News.

The province has also asked the Finance Ministry to urge insurance companies to speed compensation payments to affected enterprises.

Several companies received insurance compensation in advance, but it was only VND37.6 billion ($1.77 million), a small figure compared to the total damages of VND376.7 billion (17.73 million) suffered by the affected companies.

Nhon said the procedures for insurance compensation were complicated and time-consuming because most of the businesses had lost documents in fires and could not show proof of damage.

The province has also asked the Finance Ministry to offer guidance on how much to pay employees who lost work days during the riots.

According to the province's People's Committee, the amount must not exceed 70 per cent of the salary paid by the companies. The money would be sourced from income taxes paid by the affected businesses.

The riots occurred on May 13-14 in HCM City and in the southern provinces of Binh Duong and Dong Nai as well, as in Ha Tinh Province in the central region, after "aggressive elements" took advantage of peaceful marches against China's illegal placement of its Haiyang Shiyou oil-drilling rig in Vietnamese waters, according to local media. — VNS

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