The Ministry of Industry and Trade (MoIT) has asked cities and provincesto stop granting new investment licenses to steel projects and revise existing contracts as domestic steel supplies haveoutstripped demand.
Statistics from the ministryshowed that as many as 30 provinces in the country have steel projects.Of the total, southern Ba Ria - Vung Tau province takes thelead in terms of the number of steel projects with 15, followed byHai Phong, Phu Tho and Ha Tinh with nine and four respectively. FDI projects account for the majority of steel productionin Ha Tinh, Ba Ria-Vung Tau and Quang Ngai.
Theministry said Vietnam now had 65 steel projects with a yearlydesign capacity of more than 100,000 tonnes. In addition, additionalprojects managed by the Vietnam Steel Corporation account for atotal investment of 20 million USD.
Of the total,there are seven FDI projects and 58 domestic and joint ventures.
Last year, the industry met 54 percent of the country'stotal demand of steel ingot, 40 percent of cold steel and 100 percentof building steel.
It is estimated that by2015 the country will need 15 million tonnes of steel and 20 milliontonnes by 2020. This could lead to redundancy as total yearlycapacity of the projects will be over 35 million tonnes, between1.5-1.8 times higher than demand.
MoIT's deputyminister Le Duong Quang said only 23 steel projects had been approvedby the Prime Minister in 2007.
Quang said localitieshad granted licenses for 32 projects but they had not been approvedby the PM, adding that this was not in conformity withConstruction and Investment Law regulations.
Headded that provinces which have not ensured necessary conditions ofscale, technology, input materials, infrastructure and environmentalaudits could make the projects untenable in the long-run and havea negative effect on the environment.
To resolvethe issue, the ministry asked the provinces to check the investmentsituation and production of the industry as planned. It wouldpropose that the PM consider and grant licenses to projects which wereeligible for implementation.
It also instructedlocalities to withdraw investment licenses from projects which are notmaking progress and have no legitimate reasons for their slowimplementation.
The Vietnam Steel Association askedthe PM to withdraw licenses of slow projects that would cause wasteand affect the capacity of the industry./.
Statistics from the ministryshowed that as many as 30 provinces in the country have steel projects.Of the total, southern Ba Ria - Vung Tau province takes thelead in terms of the number of steel projects with 15, followed byHai Phong, Phu Tho and Ha Tinh with nine and four respectively. FDI projects account for the majority of steel productionin Ha Tinh, Ba Ria-Vung Tau and Quang Ngai.
Theministry said Vietnam now had 65 steel projects with a yearlydesign capacity of more than 100,000 tonnes. In addition, additionalprojects managed by the Vietnam Steel Corporation account for atotal investment of 20 million USD.
Of the total,there are seven FDI projects and 58 domestic and joint ventures.
Last year, the industry met 54 percent of the country'stotal demand of steel ingot, 40 percent of cold steel and 100 percentof building steel.
It is estimated that by2015 the country will need 15 million tonnes of steel and 20 milliontonnes by 2020. This could lead to redundancy as total yearlycapacity of the projects will be over 35 million tonnes, between1.5-1.8 times higher than demand.
MoIT's deputyminister Le Duong Quang said only 23 steel projects had been approvedby the Prime Minister in 2007.
Quang said localitieshad granted licenses for 32 projects but they had not been approvedby the PM, adding that this was not in conformity withConstruction and Investment Law regulations.
Headded that provinces which have not ensured necessary conditions ofscale, technology, input materials, infrastructure and environmentalaudits could make the projects untenable in the long-run and havea negative effect on the environment.
To resolvethe issue, the ministry asked the provinces to check the investmentsituation and production of the industry as planned. It wouldpropose that the PM consider and grant licenses to projects which wereeligible for implementation.
It also instructedlocalities to withdraw investment licenses from projects which are notmaking progress and have no legitimate reasons for their slowimplementation.
The Vietnam Steel Association askedthe PM to withdraw licenses of slow projects that would cause wasteand affect the capacity of the industry./.
