Vinashin default may benefit Vietnam

PETALING JAYA: There may be a silver lining to the Vietnamese government's refusal to support troubled Vietnam Shipbuilding Industry Group (Vinashin), which has amassed debt of US$4.4bil and defaulted on an initial payment of US$60mil to a consortium of foreign creditors that funded the state-owned enterprise's US$600mil eight-year funding facility three years ago.

Hanoi-based Mekong Securities Corp research head David Kadarauch told StarBiz that the government's refusal to support the troubled shipbuilder in its negotiation with foreign lenders could win over the confidence of investors in the long term, as (with the benefit of hindsight), this could be seen as allowing government-linked business entities to “stand on their own two feet”.