Prime Minister’s decision on electricity prices.

Under the decision, from January 1^st 2007, the average electricity rates will be set at VND842 per kWh and VND700 per kWh for the countryside. From July 1, 2008, electricity rates will be increased to VND 890 per kWh and from 2010, electricity will be adjusted according to prevailing market prices.

This means the state continues support poor, low-income and rural electrical users. These people are currently account for about 80 per cent of the total population so about 80 percent of the population will not be affected by the price rise. The adjustment aims to eradicate the State subsidy for electricity production, and ensure that enterprises (including electricity production and business enterprises) are clear in their economic calculations. The electricity price should encourage people to use electricity economically and effectively in both production and living. The profit margin will be used for investing and developing electricity.

The decision will come into force from January 1^st 2007.

Translated by THKC