Electricity prices will rise
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The Ministry of Industry and Trade is considering an electricity price hike following the huge loss reported by state utility Vietnam Electricity (EVN) for last year.
“The rate and time of the increase will be considered carefully to safeguard the benefits of EVN, the public and businesses and control inflation,” Deputy Minister of Industry and Trade Do Thang Hai told VnExpress recently.
The ministry said last week that EVN’s costs rose by 9.27% last year, and it caused a loss of VND36.29 trillion (US$1.55 billion).
Deputy CEO of EVN, Nguyen Xuan Nam, said the huge loss puts the company in a difficult financial situation, and so it has sought a hike in tariffs this year.
According to estimates by the Ministry of Finance, if power tariffs increase by 5% this year the consumer price index will see a 3.9% increase.
Hikes of 7% and 8% will push the CPI up by 4.4% and 4.8%.
The government targets containing inflation at 4.5%.
The prices consumers pay have remained unchanged since March 2019.
Questions & Answers
Q.What is the primary reason the Ministry of Industry and Trade is considering an electricity price increase?
What is the primary reason the Ministry of Industry and Trade is considering an electricity price increase?
The ministry is considering a price hike due to the significant financial loss reported by the state utility Vietnam Electricity (EVN) last year. EVN reported a loss of VND36.29 trillion (US$1.55 billion).
Q.When was the last time electricity prices for consumers in Vietnam were changed?
When was the last time electricity prices for consumers in Vietnam were changed?
Electricity prices paid by consumers have not changed since March 2019. This means they have remained consistent for several years despite rising costs.
Q.How much did EVN's costs increase last year, contributing to their financial loss?
How much did EVN's costs increase last year, contributing to their financial loss?
EVN's costs rose by 9.27% last year, which was a significant factor in the company reporting a large loss. This cost increase has impacted their financial stability.
Q.What is the government's target for containing inflation this year?
What is the government's target for containing inflation this year?
The government aims to contain inflation at 4.5% this year. The Ministry of Industry and Trade will consider this target when deciding on any electricity price increase.
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