Business
Former trade and industry minister under fire for nepotism
  • By Bich Diep-Manh Quan | dtinews.vn | June 15, 2016 03:17 PM

The Vietnam Association of Financial Investors (VAFI) has sent a letter to the Ministry of Industry and Trade, urging the ministry to inspect former minister Vu Huy Hoang’s appointment of his son to a key position in one of HCM City’s largest state-run beverage companies.

In the letter sent to the Minister of Industry and Trade Tran Tuan Anh on June 13, VAFI said that Hoang’s appointment was illegal. His son Vu Quang Hai was appointed as CEO of Saigon Beer, Alcohol and Beverage Joint Stock Corporation or SABECO in early 2015. Earlier, in 2011, Hai was promoted to general director at Petrovietnam Finance Investment JSC under his father when he was still the minister.

Between 2011 and 2012, under Hai’s management, PVFI racked up losses of VND220 billion (USD10 million) out of its total registered capital of USD13.5 million. A year after the gigantic losses were reported, Hai was moved to the MoIT’s Vietnam Trade Promotion Agency and a short time later he was assigned to be SABECO’s Deputy CEO.

 

Former Minister of Industry and Trade Vu Huy Hoang (middle)

According to VAFI, Hai couldn’t be appointed as deputy director of SABECO as he was legally liable for the massive losses accumulated during his time at PVFI.  The association has also urged Minister of Industry and Trade Tran Tuan Anh to dismiss Hai from his current position at SABECO.

VAFI also holds Deputy Minister of Industry and Trade Ho Thi Kim Thoa responsible, as she was a signatory in Hai’s appointment.

In terms of the equitisation of MoIT companies, VAFI has raised doubts that why to date the MoIT has not yet transferred Hanoi Alcohol and Beverage Corporation and SABECO to the State Capital Investment Corporation (SCIC) as regulated despite having been equitised for nearly eight years.

“Would this be because if former Minister of Industry and Trade Hoang had handed SABECO to the SCIC, his son would have had no chance of becoming SABECO’s leader?” VAFI said in the letter.

What explanation has the former minister given?

Following public concern about the case, former minister Vu Huy Hoang claimed the proposal to appoint his son was a SABECO proposal, and it had also been approved by the ministry’s party organisation.

Regarding the USD10 million losses at PVFI, Hoang claimed that this was accumulated from previous years before his son was appointed in 2011 by PetroVietnam, so, it was not his responsibility. The former minister also said there was a document signed to prove the losses resulted from the old director when Hai took his position at PVFI.

  

Vu Quang Hai, the son of former Minister of Industry and Trade Vu Huy Hoang

According to Hoang, under his son’s leadership, PVFI’s losses were curbed and during the 2012-2013 period, the firm made a small profit.

About the questions in terms of appointing Hai as Deputy Director of SABECO, Hoang explained that that the chairman of SABECO Phan Dang Tuat had sent a letter to the MoIT by the end of 2014, asking for the appointment of Hai for the position to fill the vacancy.

“Based on SABECO’s request, Hai is qualified, so we decided to move him to the firm”, Hoang said.

Hoang said that “Until now, I’ve not yet received any document from VAFI. I have not done anything unclear and for the individual purpose, so, I’m unafraid of answering any questions. I’m willing to accept responsibility if I made any mistakes,” the former minister opined.

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