July 22, 2008

Vietnam Cuts Petrol Subsidy

Text of report in English by Vietnamese news agency VNA website

Hanoi (VNA) -The retail price of lead-free RON 92 petrol increased 4,500 VND to 19,000 VND per litre as from 10 a.m. on July 21, said the Finance Ministry and the Ministry of Industry and Trade at a press conference in Hanoi in the morning of July 21.

The prices of some kinds of oil and kerosene have also risen between 2,000-6,100 VND per litre.

Speaking at the press conference, Deputy Prime Minister Hoang Trung Hai said that the State cannot maintain the current price subsidy level for petrol any longer. He said that even with the new adjustment, the State still has to subsidize 70 per cent of petrol prices.

He said that even though petrol price has been increase, the first priority is still given to inflation contain to ensure social security, economic growth and macro economic stability.

According to the Finance Ministry and the Ministry of Industry and Trade, the petrol price in Vietnam before the rise (14,500 VND per litre) was much lower than the prices in regional countries, which was 20,220 VND perlitre in Thailand , 27,129 VND in Singapore , 23,253 VND in Cambodia and 19,040 VND in Laos .

The Finance Ministry said that since the latest price adjustment on February 25, petrol businesses have suffered accumulated losses of more than 14.50 trillion VND.

The Government has instructed relevant sectors to take systematic measures to ensure supply sources and keep market stable after the petrol price hike.

Originally published by VNA news agency website, Hanoi, in English 21 Jul 08.

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