Steel businesses strive to compete in integration process

10:44 | 18/06/2015 Industry

Soon after Vietnam signed a free trade agreement with the Eurasian Economic Union EEU, domestic steel businesses are likely to compete fiercely with foreign rivals, especially those from Russia and the Commonwealth of Independent States which are enjoying zero duties.

Steel businesses strive to compete in integration process

Nguyen Van Sua, Vice Chairman of the Vietnam Steel Association (VSA), said with current competitive capacity, the domestic steel industry finds it difficult to compete with cheap steel products from China.

Since early this year, Vietnam has imported more than 2.3 million tonnes of steel from China worth over US$1.2 billion, up nearly 80% in volume and 45% in value against the corresponding period of last year.

According to the VSA, nearly 4 million tonnes of steel worth over US$2.3 billion were imported into Vietnam in the first four months of this year, up 30% in volume and 11.2% in value. Major exporters included Japan (more than 735,000 tonnes), and the Republic of Korea (RoK) (over 520,000 tonnes).

Meanwhile, Vietnam exported only 779,000 tonnes of steel, earning nearly US$577 million, down 14.2% in volume and 15.2% in value.

It shows a trade deficit of US$1.7 billion for the steel industry.

Trade experts warned that with current pace, especially after FTAs with the RoK and the EEU come into effect, the steel industry will come under strong pressure from countries like the RoK, Russia, Belarus and Kazakhstan which have a long-lasting steel industry and enjoy import duties of zero when exporting to Vietnam.

To keep a firm foothold on the home turf, domestic businesses should maintain production by raising their competitive advantages and product quality, lowering prices and sustaining after-sales services, Sua said.

The VSA also urged the Government to help the steel industry build safeguard measures such as conducting anti-dumping investigation into the sale of home-made steel products to protect domestic businesses, Sua added./.

Source: VOV News