Vietnam: Petrolimex Privatisation Back on the Cards
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Monday, 11 January 2010 |
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The Vietnamese government has signaled the resumption of its
privatization drive after earmarking the future sale of state-run
Petrolimex, the nation's largest fuel distributor, in the next round of
sell-offs.
Without specifying a timeframe, Prime Minister Nguyen Tan Dung said
that the state was to reduce its holding in Petrolimex to 75% in an
attempt to help rebalance the country's budget. The imminent
'equitisation' of Petrolimex highlights returning confidence on the
back of strong economic data and rebounding markets.
The partial privatisation of Petrolimex, which at present controls
around 60% of the Vietnamese fuels market, can be seen as part of the
wider liberalisation of the country's downstream segment. Last year,
the government began debating proposals to allow importers of refined
products to trade futures contracts and to permit private domestic
operators in the fuels market. Also, price caps at the pump were also
relaxed, although December 2009 did see the government threaten to
bring fuel pricing back under full state control once again.
State-backed Petrolimex is run by the Ministry of Trade and is one of
the largest companies in the south-east Asian nation. Although it is
impossible to give an accurate valuation for the company as it does not
publish accounts, analysts project that Petrolimex could be worth as
much as $1 billion-$1.5 billion. The firm, which can boast around 6,000
service stations in its portfolio, turned over an estimated $1.3
billion in 2008.
PetrolWorld 080110
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