Public demonstration in Binh Duong province

On May 13^th and May 14^th, there were some public gatherings to protest China’s oil rig movement into Vietnam’s territorial waters. Some hooligans took advantage of this situation and created disorder, damaged, set fire and looted properties of Chinese, Taiwanese, Singaporean and South Korean-based firms with factories in industrial parks of Ho Chi Minh City, Dong Nai, Binh Duong and Ha Tinh provinces. These actions affected the production, business operation, employment and attraction of foreign investment in Vietnam. Provincial authorities have taken many measures to restore peace, order and ensure that these companies get back to their normal business operations as soon as possible. The government has given many instructions to Ministry of Finance, Ministry of Police, People’s Committee in provinces to support the affected enterprises in overcoming difficulties and stabilizing their business activities. The government said it would assist these companies with tax breaks, rent waivers and lines of credit.

According to the Official Letter No. 949/VPCP-KTTH dated May 30^th 2014 of Government Office, the causes of damages to these enterprises have been identified as unlawful violations: destruction, burning and appropriation of properties of enterprises, not political unrest or civil commotions, etc.

Among those affected foreign companies, many are clients of insurance enterprises operating in Vietnam. According to initial reports of clients, loss amount was estimated at VND2,500 billion. Ministry of Finance has directed insurers to co-ordinate with damaged enterprises and locality to identify damages and pay compensation as soon as possible.

Insurers have initially identified insured losses and planned the execution of compensation payment timely. At the day of paying advance compensation, 113 damaged enterprises have been paid the amount of VND114.7 billion, 87 Taiwan investors out of which compensated VND59.5 billion; 3 Singapore investors with VND28.3 billion, 04 Hongkong investors with VND21.8 billion, 3 Korean investors with VND3.3 billion, etc.

This action has shown the role of insurance industry as protection to the economy in general and organizations, enterprises, and individuals in specific in the context of newly arising losses.