Ha Long ship owners on verge of bankruptcy

By Minh Cuong   June 14, 2021 | 03:57 pm GMT+7
Ha Long ship owners on verge of bankruptcy
Ships dock in Ha Long Bay due to low demand amid the Covid-19 pandemic. Photo by VnExpress/Minh Cuong.
The operators of over 500 ships in tourism hotspot Ha Long are on the verge of bankruptcy, their vessels idle amid a lack of passengers and soaring debt.

Vu Dinh Linh, the owner of 15 ships, said that in his 20 years in the tourism business, he had never been in a more challenging situation.

Since January last year, his staff had shrunk from 80 to eight, mainly security personnel.

Although his fleet lies idle, Linh still has to cover VND500 million ($21,700) in monthly costs, of which 40 percent are bank loans.

Other expenses comprise employee salaries, maintenance and berthing.

Linh’s is a typical zero to hero story. He started off operating small boats before saving enough to upscale. However, the venture came with a VND40 billion debt, and another VND10 billion in interests.

"No one wants to buy my ships, and even if they did, I would still lose."

He is one among the owners of 500 ships in the northern province of Quang Ninh struggling to keep their businesses afloat amid the Covid-19 pandemic that slashed tourism demand.

After the latest Covid-19 wave hit in late April, Quang Ninh authorities on June 8 allowed domestic boat services to resume, but to little result.

Bui Cong Hoan, the owner of three ships, has seen his number of employees drop from 50 to 10.

A few passengers show up on the weekend, but with a nearly 30 percent discount to attract them, he finds himself losing more money per trip.

"The only way to break even is to have each ship 80 percent occupied."

Authorities typically require each crew member to test negative for the novel coronavirus within seven days of departure. Each test costs around VND700,000-800,000.

"This is a burden. We have proposed all employees be vaccinated. We will pay for it ourselves too. But there has been no official reply," said Nguyen Van Phuong, deputy head of Ha Long Cruise Ship Association.

Before the pandemic, ship owners brought a major tax contribution to Quang Ninh and created jobs for 5,000 workers, but now they are debtors, he added.

Phuong proposed the government reduces interest on the debts of these ship owners and allow them to delay their payments.

Quang Ninh authorities are considering scrapping fees to visit Ha Long Bay from July and until the end of the year to reboot tourism.

 
 
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