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VietNamNews

Steel industry hopes for market revival to boost growth

Update: February, 08/2014 - 10:11
Steel processing at wholly foreign invested Zamil Steel Viet Nam Company. — VNA/VNS Photo Huy Hung
HA NOI  (VNS) — Viet Nam's steel industry might achieve 6 to 7 per cent growth this year if the stagnant market is revived, experts said.

This year, the Viet Nam Steel Corporation (VSA) has set a target of producing nearly 1.5 million tonnes of steel billets and 2.6 million tonnes of rolled steel, year-on-year increases of 24.5 per cent and 8 per cent respectively.

VSA's chairman Ho Nghia Dung said, "The economic growth must reach 5.8 to 6 per cent first, then the steel industry will be able to achieve 6 to 7 per cent growth."

Last year, the macro-economic policy aimed at cutting public investment which had trimmed the demand in real estate and construction. Weak consumption forced the steel companies to cut production.

According to VSA, 13 cast iron producers worked with 15 to 20 per cent full capacity only and 26 pig iron producers used up to 60 per cent of the full capacity. The total steel billets and rolled steel produced last year equaled 92.4 per cent and 95 per cent respectively of the planned target for the year.

In 2014, the Ministry of Industry and Trade (MoIT) will also introduce measures to resolve the difficulties facing the sector. It will work with the Ministry of Finance to help enterprises access more capital to promote their production and business.

Nguyen Manh Quan, Head of the Department of Heavy Industry under MoIT, predicted that the steel industry will continue to face fierce competition this year, especially after Viet Nam joins the Trans-Pacific Partnership (TPP).

Dung said that the most important element was the government would be formulating proper policies to warm up the steel market. That might boost the real estate and construction sectors which, in turn, will help boost steel consumption.

Other experts proposed that the policies need to help enterprises export more steel products and curb steel smuggling in order to set up a fair market for the local producers. — VNS


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