EVN rated international credit, what experts say?

"This is a highly positive move of EVN – a State-owned economic group, representing its desire for transparency and integration into the world," said Dr. Can Van Luc – Economics expert on the event that Vietnam Electricity achieved the positive credit rated by Fitch Ratings.

Economics expert Can Van Luc - Source: Dan Tri Newspaper

Reporter: Being given a currency issuer default rating (IDR) at BB by Fitch Rating, what benefit EVN will attain?
MrCan Van LucFirstly, this rating will help EVN to integrate into the world more thoroughly and make their performance more transparent.

Secondly, EVN’s access to capital sources is promoted. Especially, the Group is allowed to borrow foreign capitals with an interest rate equivalent to that applied to loans financed to national governments. In the context of decline in ODA in flows to Vietnam and without guarantee from the Government for state-owned enterprises, this rating is highly positive in helping EVN diversify its capital sources, arranging investment capital for power works.

Thirdly, it helps EVN access to foreign partners and strategic investors in the context that the Group has been accelerating the restructuring and privatization of its affiliated units.

Reporter: Besides the benefits, is this rating a challenge to EVN?

MrCan Van Luc: There is no doubt that the credit rating and benefits go along with some certain challenges for EVN. Firstly, EVN has to make efforts to maintain its rating at the national credit rating ceiling in the coming years. It is not easy to realize this task!

Besides, to maintain this rating and mobilize foreign capital sources, EVN must strive more to improve their capacity of finance, management and information transparency as well.

"The fact that Fitch Ratings rated EVN as a currency issuer default rating at BB with “Stable outlook”, equivalent to the national rating ceiling shows that EVN’s capacity of finance, management, information transparency and other competencies has been improved with many positive innovations and advances."

Reporter: As an economics expert, do you give any advice for EVN to “deal with” these challenges?

MrCan Van Luc: In my opinion, EVN shall determine to apply the corporate management models in line with international common practices; in which the requirements of information and performance transparency as well as ownership, management structure shall be implemented under international common practices.

Their restructuring needs to be fostered up, especially in the context of accelerating demand for power in Vietnam. EVN’s restructuring has achieved some positive results so far but it is required to continually speed up all fields including power generation, distribution, consumption, etc. 

The Group also should strive to more effectively reduce the power loss rate in the coming period.

Additionally, in the context of the fourth industrial revolution, EVN must keep on promoting the scientific and technological application to their production and business activities; highly pay attention to clean, renewable energy development for the sustainable development of EVN in particular and Vietnam in general.

EVN’s innovation will contribute to prompting other State-owned economic groups to access ranking organizations in the world for credit ratings. EVN, with their experience, can share and help other State-owned groups and enterprises in this success story.

Reporter: Thank you very much Sir!

  • 11/06/2018 10:43
  • Evn.com.vn