Increasing imports compound struggling steel industry woes
Increasing imports compound struggling steel industry woes
The steel industry's problems like high inventories and declining production are being exacerbated by the large volumes of various kinds of steel that are being imported despite the domestic capability to manufacture them.
A report from the General Department of Customs said in the first half of the year nearly 1.1 million tonnes of steel worth US$996 million were exported while 5.7 million tonnes valued at $4.2 billion were imported.
"Import and export are normal for an industry," Nguyen Tien Nghi, deputy chairman of Viet Nam Steel Association (VSA), said.
"The country needs many kinds of steel [but] the industry cannot produce all of them because of the lack of advanced technologies and capital."
But he was alarmed by the fact that many kinds of steel that could be produced in the country were being imported.
For instance, domestic manufacturers could fully meet the demand for construction steel, but 103,000 tonnes were imported in the first half of this year, he said.
"Companies imported construction steel under another label to enjoy low import tax. This illegal import severely affects the steel industry."
The VSA, which fears this will continue for a long time, has asked the Government to carefully manage investment in the steel industry.
"The Government should limit issuing investment licences for steel projects to prevent inventories from piling up," Nghi said.
It should put up quality and other non-tariff barriers against steel from ASEAN member countries, he said.
Steel that can be produced domestically must not be allowed to be imported, he said.
Customs should carefully examine the origin and quality of imported steel, he said, adding trade promotion programmes should be organised to widen the market for Vietnamese steel.
vietnamnews
