The chart indicates gas price in Viet Nam has risen 34 per cent since June 2013.— Photo beptietkiem.vn

HA NOI (Biz Hub) — The Ministry of Finance (MoF) has rejected a request to reduce the gas tariff to zero per cent in the hope of lowering the price the public pays for gas.

Since December 1, consumers pay an additional VND80,000 (nearly $4) per 12 kg gas canister. To help lower this price, the Viet Nam Gas Association sent a request to the MoF to reduce the current five per cent tariff for gas to zero per cent so local gas prices could see a reduction of VND17,000($0.8) per canister.

While the Ministry of Industry and Trade also supported the association's request, the MoF did not think it is the correct time for a tariff adjustment.

Nguyen Anh Tuan, Head of MoF's Price Management, told the local press on December 3 that the Vietnamese gas price is established based upon world prices, which explains the recent hike in gas prices in Viet Nam. Tuan calculated that as local gas enterprises must pay another $267.5 per one tonne of gas, it was reasonable for them to raise the price by nearly VND80,000 per 12 kg in the local market.

Regarding local concerns about poor management causing the rise of gas prices, with the price raised higher than it should be, Tuan said MoF's inspectors had conducted regular inspections of gas prices and gas enterprises since 2010 and found no violations.

He concluded that after the MoF considered factors, including market supply and demand, production and business conditions, as well as the consumer price index, officials chose to continue charging the current five per cent tariff for gas, while closely monitoring gas prices in the local and the world market.

In the event that gas prices continue rising, MoF officials will suggest the Government take suitable measures to stabilise the market, Tuan said. — VNS