The Economic and Industrial Zones Authority of Thua Thien-Hue has put the call out for an investor to develop a VND 32 trillion or US$1.29 billion steel plant in is Chan May-Lang Co Economic Zone. The plant is expected to produce three million tons of steel a year, according to The Investor.
A few points of note here.
Firstly, developing a steel project right now doesn’t seem to be particularly prudent in that there are a myriad of trade remedies investigations into steel imports around the world currently underway, including against steel from Vietnam.
Secondly, these trade remedies cases look to be the result of increased exports of cheap steel from China and Vietnam on the back of a fall in demand at home following slumps in their respective real estate markets. Ergo, it’s not clear the local market can support more steel production.
Finally, the Economic and Industrial Zones Authority of Thua Thien-Hue is an extension of the provincial government. In this light, this steel plant concept looks to be the result of state planning rather than market demand. This needs to be considered in the context of the US State Department’s review of Vietnam’s non-market economy status earlier this year which criticised the extent of government involvement in Vietnam’s economy.
See also: Commerce’s Findings from Vietnam’s Non-Market Economy Review: Unpacked