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  Policy & Strategy

Govt reinstates steel import tariffs

The Government has decided to raise import tariffs on steel products by up to 20 per cent, according to Nguyen Kinh Quoc, spokesman for the Prime Minister.

"Tariffs on steel products imported from ASEAN countries will be increased from zero to 10 per cent, and to 20 per cent for products imported from European countries and China," Quoc said last Friday.

He said the Government was raising the tariff because the domestic price of steel had dropped nearly VND2 million per tonne to VND6.2-6.5 million since April, and the domestic supply of steel was expected to last until August.

The move was also aimed at encouraging steel producers to increase production of steel ingots to meet 50-80 per cent of the country’s demand, Quoc said.

Domestic consumption is increasing and is forecast to reach more than 170,000 tonnes this month, an increase of 20,000 tonnes compared to May.

The prime minister’s decision follows last week’s Ministry of Finance recommendation that the Government increase tariffs on imported steel to strengthen the country’s struggling industry.

The ministry said it was the right time for the readjustment as world steel prices had cooled in recent weeks.

In February, the Government zeroed import tariffs on steel to stabilise domestic steel prices when world prices skyrocketed to a record US$470 (VND7.3 million) per tonne.

The Viet Nam Steel Makers Association said current world prices had dropped to less than $300 (VND4.7 million) per tonne, compared to more than $400 (VND7.2 million) over recent months.

The ministry said Viet Nam imported 4.5 million tonnes of iron and steel last year worth $1.6 billion (VND25 trillion), of which pig iron accounted for 1.8 million tonnes or $498 million (VND7.8 trillion).

VNS - (15/06/2004)

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