Vietnam’s state fuel company Vinapco claims that it is facing insolvency because two air carriers have failed to pay for fuel worth more than US$10 million
Qantas offshoot Jetstar Pacific owed the jet fuel supplier US$8.43 million while Indochina Airlines owed another $1.32 million, said Vinapco general director, Tran Huu Phuc.
Vietnam Airlines, the national flag carrier and the leading state shareholder in Vinapco, has asked the Ministry of Finance to resolve the situation, Phuc told Viet Nam News, adding “it is in process and I expect solutions will be drafted soon”.
Indochina Airlines had already defaulted on its debut, but Jetstar Pacific has committed to paying principal and interest as of July 31, Vinapco said.
Vinapco is also requiring underwriting documents from Jetstar.
Indochina Airlines, Viet Nam’s first private airline began operations in November 2008 but has been grounded for the last two years due to financial difficulties, defaulting on debts US$3.41 million.
In August 2010, Vietnamese authorities detained the former CEO of Jetstar Pacific and stopped the airline’s chief operating officer and chief financial officer from leaving the country while an investigation was under way into multi- million-dollar fuel hedging losses.
