Wednesday,  Sep 26, 2018,00:33 (GMT+7) 0 0
Ministry asks Formosa to clarify investment increase
The Saigon Times Daily
Tuesday,  Mar 13, 2018,23:26 (GMT+7)

Ministry asks Formosa to clarify investment increase

The Saigon Times Daily

HCMC – The Ministry of Planning and Investment (MPI) has asked Formosa Ha Tinh Steel Corporation to give a clarification of its capital hike from US$11 billion to US$11.6 billion, according to news website Vietnamnet.

The Taiwanese company sought the ministry’s approval for adjusting its investment certificate in line with the capital increase, which it said was due to the increased costs of certain construction components as well as machinery. Formosa also attributed the additional investment of US$600 million to an amount of US$18 million spent on a chemical coal workshop as a new component, and an increase in the paid-in capital from US$4.5 billion to US$5 billion.

Such details provided by Formosa, however, are still unclear, so the Ministry of Planning and Investment demanded further clarification. For example, as per the steelmaker’s filing, the total capital is raised by US$600 million in terms of U.S. dollar, but the amount in Vietnam dong is reduced from VND248.2 trillion to VND245.7 trillion. The disparity is not explained in the filing.

The increased costs, as stated by Formosa, relate to existing construction components plus the chemical coal plant as a new component, so there must be appraisals from relevant bodies, according to the MPI. Specifically, such a job requires the involvement of the Ministry of Finance, the Ministry of Industry and Trade, the Ministry of Construction, the Ministry of Natural Resources and Environment, and the Ministry of Science and Technology.

MPI also urged the authority of the Ha Tinh Economic Zone – where the steel complex is located – to work with the Ministry of Science and Technology and the Ministry of Industry and Trade to identify whether the chemical coal plant is an additional component or a must-have component of the company’s steel production project. The technology and environment impact of this component should be assessed as well.

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