Vietnam should not export low value added natural minerals

At the World Economic Forum (WEF) on East Asia 2010 that successfully wrapped up in HCM City on June 7, 2010, the concepts of green growth, green business have been mostly repeated.

Frederick Neumann, head of Asian Economic Research for HSBC Hong Kong said the most important issue that a developing country like Vietnam has to face now was the availability of foreign currencies to balance the country’s import and export. However, it is wrong to look for foreign currencies in exporting natural minerals with low added value because this industry cannot create jobs, improve the employees’ living standards. Moreover, Vietnam will have to face with serious problems such as depletion of natural resources and environmental degradation. He added that Vietnam should adjust its export strategies in the short coming time.

The head of HSBC’s Asian Economic Research stated that this WEF on East Asia 2010 was a good chance for Vietnam to remind the investors of an emerging destination for investment, despite the bad effects of global economic crisis.

However, the government’s policies to encourage Vietnam’s mineral processing firms to create additional value for this industry were not transparent enough. Last year, Saigon-Quy Nhon Minerals Joint Stock Co (SQC) officially put into operation the slag titanium processing plant with investment capital of one trillion dong with modern production machines and equipment that can produce high-intensity titanium steel.
However, due to high export tariff, the plant cannot export its finished products. Dang Thanh Tam, chair of SQC’s management board said that the country recently imposed export tariff of 18% and planned to lower the tariff to 15%, however, according to calculation of Vietnam Titanium Association and other processing firms, the export tariff should be 5% on titanium by-products. The enterprises would suffer loss if they export their products at present.

Tam said Vietnamese tax policies did not encourage the enterprises to process natural resources to create high added value, especially for titanium products. Therefore the government should pay more attention on policies that encourage the domestic processing enterprises to produce high added value natural resources.

Doan Xuan Hung, Deputy Minister of Foreign Affairs emphasised in the press meeting on June 7, 2010 that the success of WEF on East Asia 2010 was that it gave international enterprises and attendants a change to see with their own eyes a stable and dynamic Vietnam, thus raising the image of Vietnam in the international arena.

Yoon Jong Soo, South Korean Deputy Minister of Environment said his country allocates 2% of GDP each year on research and development and incentives to encourage green business growth to cut down emission of CO2. In order to encourage green growth, many countries have reduced and exempted tariff for enterprises using renewable energy.

In fact, Asian countries need to create new business models for green growth and the preservation of natural resources. The collaborations among the countries should include speeding up approval of green goods and services, and incentives for research and development in green technologies for sustainable development and environment protection.

Thanhnien

Tags: Vietnam natural minerals

Posted by VBN on Jun 9 2010. Filed under Mining & Metal. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry