Vietnam raises retail electricity price by 3%

HANOI : Vietnam on Thursday raised its average retail electricity price by 3 per cent, the government said, in a move that could put upward pressure on inflation.

Annual inflation in the Southeast Asian country has been easing since the beginning of the year, with April consumer prices rising 2.81 per cent from a year earlier. The government is targeting average inflation of 4.5 per cent for the year.

The widely anticipated hike in electricity prices is expected to help state utility EVN reduce losses as production costs remain elevated.

The average price was raised to 1,920.4 dong ($0.0819) per kilowatt hour, excluding value added tax, the government said in a statement, noting that electricity production costs rose 9.27 per cent last year.

EVN made a net loss of 31 trillion dong last year, according to the Ministry of Industry and Trade.

($1 = 23,445 dong)