Foreign investors follow JFE to flock to Dung Quat

Foreign investors follow JFE to flock to Dung Quat

Right after JFE, a big Japanese group, announced its plan to invest in Vietnam, other Japanese investors have also shown their intention to follow JFE.

BIKEN late last week came to Quang Ngai province to seek investment opportunities. They are all from Japan and they plan to set up production bases in the province and operate as satellite enterprises for the Guang Lian Dung Quat steel project, which was granted the investment license some years ago with the investment capital of 3 billion dollars, now awaiting for the permission to increase the investment capital to 4.5 billion dollars.

Le Van Dung, Deputy Head of the Dung Quat Economic Zone, has confirmed the news with Dau tu, saying that JFE has signed a memorandum of understanding with E-United on the cooperation to develop the Guang Lian steel project. Dung also said that right after the information was released, a lot of investors in lime, donomite iron, industrial gas and concrete manufacturers have arrived in Quang Ngai to consider setting up their production bases here.

The latest comer is BIKEN, which specializes in making fresh concrete. This would be the concrete producer and supplier to Guang Lian project, once the steel mill is completed.

Also according to Dung, besides the steel complex, investors would run a series of supporting projects in material preliminary treatment, high grade steel products, which would need the total land area of hundreds of hectares.

Of course, the Quang Ngai provincial authorities applaud the development of the projects on supporting industries. Dung said that attracting projects in supporting industries, together with steel, oil and gas, shipbuilding, heavy equipment mechanical engineering, has always been the target of Quang Ngai province in general and Dung Quat economic zone in particular.

Many years ago, when setting up the economic zone, the provincial authorities also stated that Dung Quat is developed to become a heavy industry center of the whole country.

As such, though it’s still early to affirm that JFE would join the Guang Lian steel project, since the group is still doing the field work and considers the feasibility of the project, the positive effects of the presence of JFE in Vietnam are obvious.

In fact, JFE once came to Dung Quat to consider the possibility of making investment here in 2007. It also wrapped up the pre-feasibility project on a steel complex with the capacity of 6 million tons in the first phase, which may be raised to 12 million tons later.

However, at that time, due to the global economic crisis, JFE had to give up the project which was estimated to cost 6.9 billion dollars. Now it may return to Dung Quat and join hands with E-United to carry out the feasibility study over Guang Lian project.

Dung said that Japanese enterprises now tend to make outward investment after they witnessed the serious natural calamities in 2011. Meanwhile, Dung Quat economic zone proves to be the ideal choice for them, especially with its deep water port.

“We strongly hope that JFE would decide to join forces with E-United to develop Guang Lian steel project,” Dung said, adding that since the day the memorandum of understanding was signed in late March 2012, JFE has continuously sent staff to Dung Quat to do the field work. They have been learning about the capability of the port, the infrastructure conditions and the tax incentives offered by the host country of Vietnam.

According to Saigon Tiep Thi, Quang Ngai province has released the overall development plan for Dung Quat, under which it would attract 13 billion dollars worth of investment projects by 2015.

vietnamnet