Authorities mull additional measures to protect steel sector

16:16 | 27/02/2017 Industry

(VEN) - The Vietnam Steel Association (VSA) has concerns about tax evasion for rolled steel products, posing difficulties for domestic steel manufacturers. It believes this requires authorities to take measures to protect the steel sector, in particular, and the national economy in general.  

According to the Ministry of Industry and Trade, import turnover of steel reached an estimated US$8.024 billion in 2016, an increase of 7.3 percent compared to the previous year. The increased import turnover of steel was due to higher volume and prices. China, Japan, the Republic of Korea and Chinese Taipei continued to be the main steel providers for the Vietnamese market.

In fact, domestic steel producers are only able to meet a half of domestic demand. However, they have to compete in prices with the same kinds of Chinese products.

The Ministry of Industry and Trade applied temporary protectionist duties on imported steel to protect the general well-being of the sector. Accordingly, new duties on steel billets and long steel products of 23.3 percent and 15.4 percent, took effect in March 2016.

The Ministry of Industry and Trade then made a final decision to impose import tariffs on steel billets and long steel products. The tariff will be adjusted down by two percent each year to 17.3 percent in March 2019, and to zero percent from March 22, 2020 for steel billets.

Nguyen Phuong Nam, the deputy director of the Ministry of Industry and Trade’s Vietnam Competition Authority, said that protectionist duties are an urgent measure to prevent the collapse and bankruptcy of domestic production.

The Ministry of Industry and Trade’s Vietnam Competition Authority is collecting opinions from all sides before making a decision to apply protectionist duties on rolled steel products and steel wires, due to concerns concerns about tax evasion for those products with HS Code 72139190. After the Ministry of Industry and Trade applied protectionist duties on steel products with HS Code 72279000 in April 2016, imports of rolled steel products increased significantly.

VSA Deputy Chairman Nguyen Van Sua said that the Vietnamese steel sector has not yet focused on the production of steel

wires as demand remains limited. However, since the application of protectionist duties on steel products with a HS Code

72279000, some domestic steel manufacturers have paid greater attention to those products.

Thu Ha