Railways seeks bailout as Covid-19 rages
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Vietnam Railways (VNR) is seeking a VND800 billion ($34.82 million) loan to fund operations amid plummeting demand for its services because of the Covid-19 pandemic.
The state-owned company has requested the government for the funds, saying that if the pandemic impacts persist until the next year, it would run out of money to pay staff salaries.
It is, therefore, proposing that the government gives it an “emergency” loan and provide support for its 13,000 employees, who are either suspended or working part-time.
It is also proposing that over 6,000 employees are prioritized for vaccination; and that infrastructure fees and land fees are lowered or scrapped for the projects it is implementing.
Last month, the company suspended 393 trains, and there were times when just one pair of trains was used for the North-South route.
The company’s revenues in the first five months fell 19 percent year-on-year to VND1.11 trillion and 40 percent from 2019, when the pandemic was yet to hit the country. It posted a loss of over VND1.32 trillion last year.
Questions & Answers
Q.What immediate financial assistance is Vietnam Railways (VNR) requesting from the government?
What immediate financial assistance is Vietnam Railways (VNR) requesting from the government?
Vietnam Railways is asking for an 800 billion VND (£24.82 million) emergency loan to cover operational costs. This funding is crucial to ensure it can continue to pay staff salaries if the pandemic's impact continues into next year.
Q.What measures is VNR proposing to support its workforce during the pandemic?
What measures is VNR proposing to support its workforce during the pandemic?
VNR is asking the government for support for its 13,000 employees, many of whom are suspended or working part-time. It also proposes that over 6,000 employees are prioritised for vaccination to protect them.
Q.How have VNR's revenues been affected by the pandemic so far this year?
How have VNR's revenues been affected by the pandemic so far this year?
In the first five months of this year, VNR's revenues dropped by 19 percent compared to the previous year, reaching 1.11 trillion VND. This also represents a 40 percent decrease from 2019, before the pandemic began.
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