Vietnam Prime Minister Nguyen Tan Dung has turned down Vietnam Ship Building Industry Group or Vinashin’s plan to do business in aviation, according to document sent by chairman of Government Office Nguyen Xuan Phuc.
The document showed that Vinashin wants to team up with Malaysia’s budget Air Asia in setting up a budget airline in Vietnam.
Recently, the two groups singed a memorandum of understanding on establishing a joint venture budget airline, Vina AirAsia with a registered capital of around US$30 million.
State-owned Vietnam Airlines and joint stock Pacific Airlines immediately sent massage proposing the Government not to license Vina Air Asia.
Vietnam Airlines’ director general and chairman Nguyen Sy Hung said the national flag carrier protested the plan because “Vietnam should be strict on issues”, adding that the airlines itself still cannot get the right to fly from Beijing to Moscow and the U.S., the author of the “open sky” policy, does not allow foreign airlines to fly domestic routes due to insecurity.
Chief Executive Officer of Pacific Airlines, Luong Hoai Nam said Air Asia once intended to make investment in Pacific Airlines, but the two sides could not reach an agreement.
Nam said the 30 per cent of capital Air Asia intended to contribute to Pacific Airlines comprising two parts, tangible and intangible, while the intangible assets proved to be very difficult to be valued.
If not counting the intangible assets Air Asia planned to contribute to Pacific Airlines, the price the Malaysian partner planned to pay for Pacific Airlines’ stakes was too low, compared to that offered by other foreign investors, including Qantas.
Meanwhile, Qantas demanded that Vietnam will license any new airline for three years after the air carrier made investment in Pacific Airlines.
In dispatch No 2337 of the Civil Aviation Administration of Vietnam sent to the Ministry of Transport, Deputy Head Luu Thanh Binh suggested that Vietnam prioritize licensing domestic owned airlines, while not allowing foreign invested airlines to set up at this moment.
Experts say that it is necessary to consider thoroughly the possible influences of a new airline on the domestic aviation market. (Investment, Vietnamnet)
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