Viet Nam's steel industry is heatening up on the back of foreign investors queuing up to take advantage of the country's expanding economy and increasing demand for steel from the domestic construction sector.
India's Tata Group, one of the six largest steel companies globally exemplifies the interest that overseas firms have in the market. The group is about to get a 3.5 billion USD rolled steel facility underway near the Thach Khe iron mine in central Ha Tinh province that when fully operational will roll out 4.5 million tonnes a year.
Speaking with a Viet Nam News Agency’s correspondent, President of the Viet Nam Steel Association Pham Chi Cuong said the presence of big international steel groups in Viet Nam reinforced the attractiveness of a Vietnamese steel market that has been fuelled by an average yearly domestic demand growth of 40 percent.
Hooking up on a joint venture in Hai Phong to produce steel pipes and rolled steel and another in Ho Chi Minh City to manufacture corrugated iron, the Republic of Korea's Posco Group is now planning to invest in a steel plant with a total output capacity of 3 million tones of rolled steel at the Phu My 2 Industrial Zone in southern Ba Ria-Vung Tau province. Work on the 1 billion USD plant is scheduled to begin in August.
Cuong said Posco has also signed a deal with the Viet Nam Shipbuilding Industry Corporation (Vinashin) to build a steel complex with a capacity of 5 million tonnes of steel plates and rolled steel per year.
India's Essar has also linked up with the Viet Nam Steel Corporation and the Viet Nam Rubber Corporation on a 527 million USD project in Ba Ria-Vung Tau province that will pump over 2 million tonnes of rolled steel per year into the domestic market.
In central Quang Ngai province, Taiwan’s Tycoons and E-United have received the green light from the local authorities to invest 1.8 billion USD in a plant in the Dung Quat Economic zone. Construction of the plant is slated to begin in mid-October.
George E. Kobrossy, General Director of Zamil Steel Viet Nam, which has been operating in the country for over a decade, pointed to a low cost work force, political stability, incentives from the Vietnamese Government and a readiness of local businesses to cooperate as primary reasons for the boom in the industry.
Source: VNA
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