~ Le Viêt Nam, aujourd'hui. ~
The Vietnam News

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Vietnam increases fuel prices in bid to offset state subsidies

HANOI - Vietnam has increased fuel prices nationwide to offset state subsidies to the gas industry and help fight illegal smuggling of petroleum products out of the country, state-controlled media reported Wednesday. The prices for gasoline, kerosene and diesel were increased on Tuesday by 100 dong to 650 dong (0.6 U.S. cents to 4 cents) per liter, an increase of 2 percent to 13 percent, the Liberated Saigon newspaper said.

The newspaper quoted Vice Finance Minister Tran Van Ta as saying world prices for gasoline have risen 26 percent on year in the first quarter, and the government has had to provide 4.87 trillion dong (US$308 million; euro238.28 million) in subsidies to local gas importers in the first three months. The subsidies for diesel and kerosene imports, used in various industries as well as the transport sector, are expected to cost the government 12.3 trillion dong (US$778 million; euro601.89 million) this year, he said. Ta also said the price hikes would help fight illegal smuggling of gasoline out of Vietnam to other countries where fuel is more expensive.

In June last year, Vietnam also increased gasoline prices amid soaring world prices. Vietnam has to import all its petroleum products while its first oil refinery plant is under construction in central Quang Ngai province.

The Associated Press - March 30, 2005