Identifier
Created
Classification
Origin
10CANBERRA24
2010-01-11 06:21:00
UNCLASSIFIED
Embassy Canberra
Cable title:
TWO QANTAS EXECUTIVES HELD IN VIETNAM
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UNCLAS CANBERRA 000024
SIPDIS
E.O. 12958: N/A
TAGS: PREL ELAB PREF SMIG AS
SUBJECT: TWO QANTAS EXECUTIVES HELD IN VIETNAM
UNCLAS CANBERRA 000024
SIPDIS
E.O. 12958: N/A
TAGS: PREL ELAB PREF SMIG AS
SUBJECT: TWO QANTAS EXECUTIVES HELD IN VIETNAM
1. (SBU) SUMMARY: Two Australian airline executives are being
prevented from leaving Vietnam over fuel hedging losses
incurred by Vietnamese controlled airline JetStar Pacific.
Australian airline QANTAS, which owns 27 percent of the
airline, is strongly defending the two executives and is
trying to persuade Vietnamese authorities that the losses
were result of normal business risk. This has received
considerable media play at a slow news period in Australia's
summer holidays. The Department of Foreign Affairs and Trade
(DFAT) has raised the matter with Vietnam's Ambassador to
Australia. END SUMMARY.
EXECUTIVES HELD
2. (U) On Friday January 8, Vietnamese media reported that
two Australian executives of JetStar Pacific - an offshoot of
Australian airline QANTAS - had been prevented from leaving
Vietnam over $US31 million of "fuel hedging" losses (they are
apparently free to move around Vietnam). The two
Australians, along with the former CEO, were allegedly
accused of defying a board of directors resolution on buying
aviation fuel futures. According to the Toui Tre newspaper,
the resolution allowed them to buy fuel futures to the end of
2008 but they kept buying until May 2009. QANTAS bought into
Vietnam's second-biggest airline, then known as Pacific
Airlines, in 2007. It now owns 27 per cent.
REACTION
3. (U) Australian media have given considerable play to the
story, which emerged in a very slow news period over
Australia's summer holidays. DFAT confirmed the identities
of the two executives, Daniela Marsilli and Tristan Freeman,
and said it raised the matter with Vietnam's Ambassador to
Australia on December 24. QANTAS CEO Alan Joyce strongly
defended their actions, asserting that the losses were "part
of a global business risk" and that the Vietnamese government
was "still learning" about practices such as hedging.
4. (SBU) COMMENT: Despite the extensive media coverage,
journalists have not formally requested comment from Acting
Foreign Minister Simon Crean. This may reflect the focus on
AUSMIN; renewed attention on the fate of a mining executive
in China (which has similarities to this issue); and tensions
with Japan and India over whaling and student bashings,
respectively. Nevertheless the media continue to follow the
issue. It will increase in diplomatic and domestic political
importance the longer it drags on. Like the Stern Hu case,
it will generate reflection on the risks of doing business in
countries with vastly different values and political systems.
END COMMENT.
CLUNE
SIPDIS
E.O. 12958: N/A
TAGS: PREL ELAB PREF SMIG AS
SUBJECT: TWO QANTAS EXECUTIVES HELD IN VIETNAM
1. (SBU) SUMMARY: Two Australian airline executives are being
prevented from leaving Vietnam over fuel hedging losses
incurred by Vietnamese controlled airline JetStar Pacific.
Australian airline QANTAS, which owns 27 percent of the
airline, is strongly defending the two executives and is
trying to persuade Vietnamese authorities that the losses
were result of normal business risk. This has received
considerable media play at a slow news period in Australia's
summer holidays. The Department of Foreign Affairs and Trade
(DFAT) has raised the matter with Vietnam's Ambassador to
Australia. END SUMMARY.
EXECUTIVES HELD
2. (U) On Friday January 8, Vietnamese media reported that
two Australian executives of JetStar Pacific - an offshoot of
Australian airline QANTAS - had been prevented from leaving
Vietnam over $US31 million of "fuel hedging" losses (they are
apparently free to move around Vietnam). The two
Australians, along with the former CEO, were allegedly
accused of defying a board of directors resolution on buying
aviation fuel futures. According to the Toui Tre newspaper,
the resolution allowed them to buy fuel futures to the end of
2008 but they kept buying until May 2009. QANTAS bought into
Vietnam's second-biggest airline, then known as Pacific
Airlines, in 2007. It now owns 27 per cent.
REACTION
3. (U) Australian media have given considerable play to the
story, which emerged in a very slow news period over
Australia's summer holidays. DFAT confirmed the identities
of the two executives, Daniela Marsilli and Tristan Freeman,
and said it raised the matter with Vietnam's Ambassador to
Australia on December 24. QANTAS CEO Alan Joyce strongly
defended their actions, asserting that the losses were "part
of a global business risk" and that the Vietnamese government
was "still learning" about practices such as hedging.
4. (SBU) COMMENT: Despite the extensive media coverage,
journalists have not formally requested comment from Acting
Foreign Minister Simon Crean. This may reflect the focus on
AUSMIN; renewed attention on the fate of a mining executive
in China (which has similarities to this issue); and tensions
with Japan and India over whaling and student bashings,
respectively. Nevertheless the media continue to follow the
issue. It will increase in diplomatic and domestic political
importance the longer it drags on. Like the Stern Hu case,
it will generate reflection on the risks of doing business in
countries with vastly different values and political systems.
END COMMENT.
CLUNE