Dung Quat calls for investment into plastic industry

Authorities of Dung Quat Economic Zone are calling for plastic producers to set up shop in the zone to help develop industrial clusters for the plastic industry.

Le Van Dung, vice director of Dung Quat Economic Zone Authority, said the authority had plans to establish these ICs in the zone soon, but in the past it was difficult to set the plan in motion due to lack of seaport infrastructure, and local plastic material sources.

But now Gemadept Dung Quat International Port in the zone in the central province of Quang Ngai has been opened, facilitating transport of containers to local and international destinations.

A PP plant designed to yearly process 260,000 tons of material from Dung Quat Oil Refinery into some 150,000 tons of PP has come on stream, making it more favorable for plastic enterprises to build factories there, Dung said.

The plant uses propylene from Dung Quat refinery as feedstock to produce PP for the auto, power transmission and packaging industries, among others. When in full operation, it will help reduce the country’s reliance on plastic material imports.

Tran Cong Hoang Quoc Trang, chairman of the HCMC Plastic Association, said at a recent meeting in HCM City that he backed the idea of moving the factories of HCM City plastic enterprises out of the city.

According to the association, plastic is a growing industry in Vietnam with an annual growth rate of around 15-20% in the past ten years. However, the sector also imported up to 80% of material for local plastic manufacturing.

The fall of the Vietnamese dong against the U.S. dollar and rising material costs since last year have impacted on the competitiveness of plastic manufacturers. So securing local supply of PP material will be a great competitive advantage for plastic firms to build factories in the zone.

“Plastic enterprises in HCM City investing into the zone can rest assured there is local PP material supply and from the zone, they can shorten the distance of transporting products to the northern market,” Dung said.

PV Building is looking for local partners to develop a plastic product manufacturing project using material from the zone’s PP plant. The 20-ha project will manufacture household, hi-tech and building plastic products.

As a member of Dung Quat oil refinery, PV Building will have material supplied by the Polypropylene Dung Quat plant, Dung said. In the initial phase, PV Building’s project will serve as an impetus to attract plastic firms to come to the zone.

The authority said it would introduce some investment incentives involving land, training and infrastructure development.

Under a revised master plan for the zone until 2025, approved recently by Prime Minister Nguyen Tan Dung, the Dung Quat Economic Zone will be expanded from the current 10,300 hectares to more than 45,300 hectares, including 10,752 hectares of sea surface.

The zone will become a general multi-sectoral and multi-disciplinary zone, with a focus on the oil refining, petrochemical, chemical and heavy industries.

Since it debuted 14 years ago, the zone has attracted 113 foreign-invested projects worth US$9.3 billion, has seen FDI capital disbursement amounting to nearly US$5 billion and has created jobs for over 12,000 workers. – SGT

Tags: Vietnam plastic industry