Government rejects Formosa’s steel economic zone proposal
Government rejects Formosa’s steel economic zone proposal
Government spokesman Nguyen Van Nen said at a press conference on July 1 that Vietnam has no regulation that allows foreign investors to set up special economic zones and would not accept Taiwanese investor Formosa’s proposal to establish a steel economic zone.
Earlier, the Taiwanese-invested company had written to Deputy Prime Minister Hoang Trung Hai seeking approval to set up a Vung Ang steel and iron SEZ in the central province of Ha Tinh and enjoy special incentives.
Formosa wants to build a deepwater port to serve production, a protection mechanism for the steel industry and receive tax exemptions, including import tariffs on machinery, equipment and materials.
It has also asked for a land allocation scheme that will benefit 15,000 staff, or 60,000 people, if their relatives are included.
This proposal came after Formosa suffered damage due to worker protests against China’s illegal deployment in mid-May of Haiyang Shiyou-981 oil rig deep inside Vietnam’s exclusive economic zone and continental shelf.
In the aftermath of the incident, the Government has extended policy support for the company.
Formosa’s steel and iron complex project is expected to be commissioned during the first phase in 2015 with total capacity of around 22.5 million tons a year.
According to Mr. Nen, chief of the government office, most of the workers of the Formosa project in Vung Ang, Ha Tinh Province returned to work after the riots in May.
The construction progress at the Formosa project has not been greatly affected by the incident in May.
However, to complete the project, the Taiwanese investor has asked the Vietnamese government to have specific policies for the project, focusing on administrative procedures to help them attract investors.
vietnamnet
