On March 14, the conference on implementing monetary policy tasks for 2024, focusing on resolving difficulties for production and business, promoting growth and macroeconomic stability, was held with the participation of Prime Minister Pham Minh Chinh and Deputy Prime Minister Le Minh Khai. Many leaders of corporations and businesses attended and presented.
At the conference, Mr. Le Manh Hung, Chairman of the Council of Members of the Vietnam Oil and Gas Group (Petrovietnam, PVN), emphasized that the management of monetary policy plays a very important role, especially in the context of our credit-to-GDP ratio being one of the highest in the world.
The Chairman of Petrovietnam said that credit in the whole PVN unified group is currently about 240,000 billion VND. If the interest rate increases by 1%, the capital cost of the group will increase by about 2,400 billion VND per year. Therefore, restructuring capital and finance in production and business activities, especially in Petrovietnam’s investment projects, is essential. It helps to optimize the use of capital costs in each project, similar to the Nghi Son Refinery and Petrochemical Complex project, which the Prime Minister directly instructed to restructure borrowing from credit institutions worldwide.
“We highly appreciate the management of monetary policy and credit, which has ensured stable interest rates, inflation, and exchange rates. It has helped large enterprises like Petrovietnam to stabilize and achieve results as in the past period,” Mr. Le Manh Hung said.
Currently, PVN is in negotiations with banks to restructure its loans with new loans that have lower average capital costs. This will help optimize the production and business costs of the joint venture company and gradually overcome difficulties.
Credit in the whole PVN unified group is currently about 240,000 billion VND. Photo for illustration purposes.
In the coming time under the 2021-2025 plan, Petrovietnam plans to mobilize about 250,300 billion VND in credit for investment and development.
With the sensitivity of interest rates on the capital costs of PVN, the leaders of the group hope that the Government and the State Bank will continue to maintain policies on optimal and stable interest rates to avoid affecting the production, business, and investment activities of the group and businesses in general.
In addition, the PVN leaders also mentioned exchange rate risks. Currently, PVN’s foreign currency borrowing balance is 38,000 billion VND, equivalent to over 1.5 billion USD. Therefore, the fluctuation and exchange rate risks have a significant impact on the production and business activities of the group, especially in risk management according to exchange rate fluctuations.
“We hope that in the coming time, the State Bank will have solutions to keep the exchange rate stable,” Mr. Le Manh Hung, Chairman of PVN, said.
At the beginning of 2024, announcing the business situation at the Conference on Reviewing the Work in 2023 and Implementing the Tasks in 2024 of the group, Petrovietnam’s oil exploitation in 2023 reached 10.41 million tons, exceeding the annual plan by 12.1%. Gas production reached 7.47 billion cubic meters, exceeding the plan by 25.7%.
The total revenue of the whole group reached 942.8 trillion VND, exceeding the annual plan by 39%, and was over 11.6 trillion VND higher than the record in 2022, equivalent to 9.2% of the country’s GDP.
PVN’s contribution to the state budget reached 151.8 trillion VND, surpassing 94% of the annual plan and accounting for about 9% of the total state budget revenue in 2023. The consolidated pre-tax profit of the group in 2023 reached 54.5 trillion VND, exceeding the annual plan by 57%.
