Building material industry needs support to overcome economic difficulties

Building material industry needs support to overcome economic difficulties

The Government was urged to implement policies limiting imports and accelerating consumption of domestic building materials.

It is a measure recommended by the Viet Nam Association for Building Materials to reduce inventories and support struggling enterprises.

State-invested projects and those under engineering – procurement – construction practices should be required to use domestic building materials while infrastructure projects (including roads and grounds of industrial zones) using cement should be hastened nationwide, the association said.

“This would help stimulate demand for cement while reducing imports of asphalt,” the association’s president Tran Van Huynh told Thoi Bao Kinh Te Viet Nam (Viet Nam Economic Times).

According to the Ministry of Industry and Trade’s report, the high inventories were attributed to the impact of cuts to public investment, a weaker export market and tough competition from imports.

Many factories have had to halt operations due to high inventories. In regard to cement production alone, a number of factories incurred losses such as Dong Bnh, Thi Nguyn and Cam Pha plants.

Due to the economic crisis, domestic cement demand was estimated to fall by 14-15 million tonnes during the 2011-13 period to reach just 60-62 million tonnes by 2015, a long way off the planned figure of 75–76 million tonnes.

If consumption plans are not adjusted, by 2015 the total capacity of cement plants will reach more than 94 million tonnes, far outstripping demand.

According to L Van Toi, director of the Building Material Department under the construction ministry, the ministry will continue to review master planning for the building material industry towards 2020 with a focus on developing clean technology and new materials.

Regarding cement industry development, he said adjustments would aim to ensure the balance of supply and demand in the short and longer term.

Management of building material imports will also be tightened to prevent unhealthy competition from damaging domestic production, he added.

Minister Trinh Dinh Dung urged enterprises to play an active role in the restructuring process, by renovating technology, enhancing management capacities and overall efficiency to weather the difficult period.

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