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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 
 
¶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