Paper project set for wrap up

‘If it [Lee & Man] doesn’t resume construction, we will have no choice but to revoke [the licences for] these paper projects’

Lee & Man Paper Manufacturing has entered the last chance saloon.

Hau Giang People’s Committee is losing patience with the Hong Kong firm and has warned it will revoke the firm’s investment certificates if it does not push ahead with two long-delayed projects.

Early this month, the provincial authority ordered Lee & Man to get on with construction of its pulp and packaging paper factories in the province by September 20. The authority said an inspection team would visit 10 days later to check up on progress at the Lee & Man site.

“If the firm doesn’t resume construction, we will have no choice but to revoke [the licences for] these paper projects,” said Truong Canh Tuyen, director of Hau Giang People’s Committee’s Administration Department.

In 2007, Lee & Man was handed investment certificates to build two factories totally worth $600 million in Song Hau Industrial Park in Hau Giang. The firm’s plans involved building plants able to produce 150,000 tonnes of pulp and 420,000 tonnes of packaging paper a year.

Figures from Hau Giang People’s Committee show that Lee & Man has disbursed only $35 million in its Vietnam projects since 2008.

What it has done is clearing 75 per cent of its 83 hectare site along with building three warehouses, internal roads and a small workshop only.

The latest Hau Giang People’s Committee warning is the second time this year that Lee & Man has been brought to task over the slow implementation of its projects.

The first time, back in April, Lee & Man committed to finishing clearing the site by June.

“It made a promise, but did nothing. This is unacceptable,” said Tuyen, adding that the projects’ delay had negatively impacted on the province’s economic development, as well as lives of residents.

Lee & Man is one of the leading paper manufacturers in China, specialising in producing linerboard and corrugating mediums used to produce cardboard boxes.

The paper manufacturer has four paper production plants in China, but the projects in Hau Giang are the company’s first manufacturing facilities outside that country.

Lee & Man’s representative in a meeting with the provincial authority said the projects’ delays were the result of the global economic recession.

But while Lee & Man is delaying investment plans in Vietnam, it remains in expansion mode in China. On its website, the firm said it was expanding four production lines in China, which are expected to commence production at the end of next year adding an annual effective capacity of 1.6 million tonnes to the firm’s output.

Tags: Lee & Man Paper Manufacturing