VietNamNet Bridge – The strategic cooperation of the three big
guys in the energy sector is believed to harm the national economy because it
would make the market monopoly become more serious.
Three most powerful groups in the
energy sector, namely the Electricity of Vietnam (EVN), PetroVietnam (PVN) and
the Vietnam Coal and Mineral Industries Group (Vinacomin) have signed a
strategic cooperation agreement, aiming to form up an alliance to better manage
the electricity production and distribution.
The appearance of an alliance of
the giants has raised big worries among the public. The three big guys are all
the exclusive manufacturers and distributors in their fields. What will happen
if they join forces and control the domestic power market?
Pham Chi Lan, a well-known
Vietnamese economist, has pointed out that the cooperation of the three power
groups would create a bigger monopoly. More dangerously, the monopoly would
exist in the energy sector, which has big impacts on all other business fields
of the national economy.
She has also warned that with the
monopoly to be created by the three big groups, it would be even more difficult
for the State to manage the enterprises.
The three big guys explained that
their cooperation would help better manage the power production and
distribution. However, they cannot convince people that the cooperation would
be for the sake of the national economy.
Will the cooperation help reduce
the electricity shortage? Will the electricity cuts occur? Will Vietnam have to
import electricity? Will domestic power plants be able to sell electricity to
EVN, or will EVN continue buying electricity from China? No one can say for
sure that the current existing problems would be settled once the three big
guys cooperate with each other.
While it’s still unclear about
the benefits the alliance can bring to the national economy, a worry has been
raised that the alliance would deprive the opportunities of other businesses to
join the market.
What will happen if EVN, the only
electricity wholesale buyer, prioritizes to buy electricity from PetroVietnam’s
or Vinacomin’s power plants? If so, no other enterprise would have the
opportunity to sell electricity to EVN. This would not only lead to the
collapse of the power plants, but also make the national plan on developing a
competitive power market fail completely.
Also according to Lan, the
Competition Administration Department (CAD) has the right the ask the three
power groups to show their business strategy and the way the three groups would
cooperate. To date, EVN still has been controlling the power distribution
market.
However, the problem is that CAD
is not an independent agency, but it is an arm of the Ministry of Industry and
Trade, which is the governing body of EVN, Vinacomin and PetroVietnam.
Le Dang Doanh, a well-known
economist, has also warned that if the three power groups join forces to
strengthen their monopoly, this would be a big threat to the national economy.
It may happen that the alliance of the three groups would control the
electricity price, while the electricity price would keep escalating and become
unbearable for businesses.
Doanh has stressed that Vietnam
now is very bad at controlling the monopoly. Therefore, the situation may
become even worse if the three groups join forces to control the power market.
GDVN
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