Steel manufacturer tries to revive after 10 years of being idle

The expansion of the Thai Nguyen steel project has yet to be completed after 14 years. Several former managers of the Thai Nguyen Iron and Steel JSC (Tisco) have been sent to prison for wrongdoings related to the project.

Steel manufacturer tries to revive after 10 years of being idle

The defendants

The Thai Nguyen Cast Iron and Steel Complex was the ‘first child’ and the pride of Vietnam’s metallurgy sector. Tisco was once a strong brand in the industry. But since 2018 its performance has steadily declined.

Many managers of Tisco and the Vietnam Steel Corporation (VnSteel) had to appear before the court and were given severe punishments because of wrongdoings during the implementation of the second phase of the project.

On April 20, after more than one week of hearings and deliberation, the Hanoi People’s Court sentenced 19 defendants who were once VnSteel and Tisco managers.

Tran Trong Mung, former CEO of Tisco, was sentenced to nine years and six months in prison, while Tran Van Kham, who was chair of the board of management and CEO of Tisco, got eight years and six months; Mai Van Tinh, former chair of the board of management got six years, and Dau Van Hung, former CEO of VnSteel, got three years in prison for "violating regulations on management and use of state assets, causing losses and waste".

The other defendants were sentenced to 18 months in prison, but they received a suspended sentence on the same count, for "lacking responsibility, causing serious consequences".

Soon after the hearing finished, Tisco asked for permission to restart the project and submitted a plan to revive the second phase of the project.

Tisco’s leadership believes that if the outstanding problems of the second phase of the project cannot be solved, the company will face serious difficulties.

Most of the equipment needed to implement the second phase of the project was bought by MCC, the Chinese contractor. The equipment is being kept by Tisco. However, storage over such a long period will damage the equipment.

Tisco is one of the 12 loss-making mega projects under the Ministry of Industry and Trade (MOIT). The assets of the projects total VND59.1 trillion, while total accounts payable is VND63.3 trillion.

If Tisco cannot resume implementation, the quality of the equipment will degrade. It also still has to pay loan interest, which leads to higher costs.

The 12 projects include four fertilizer production, three biofuel production, two steel manufacturing, one polyester production, one pulp and one shipbuilding project.

 

Partial implementation planned

Tisco managers affirmed that if the second phase of the project cannot be reactivated soon, the company will find it hard to maintain production.

If production halts, nearly 4,000 workers will lose their jobs, affecting the life of 20,000 people. This will lead to a loss estimated at VND1.2 trillion) for the state, while commercial banks will not be able to collect debts.

This will also affect hundreds of Tisco’s partners, suppliers and customers across the country.

Tisco’s managers said that the technology used for the second phase of the project is modern. Some equipment has been installed, while the remaining has been maintained well and can be used.

The company production would be self-sufficient in cast iron, coke, ingot steel, gas and oil fuel, thus creating higher added value.

If Tisco cannot resume implementation, the quality of the equipment will degrade. It also still has to pay loan interest, which leads to higher costs.

If the situation lasts for a long time, the company will not be able to maintain production, and could go bankrupt and lose the state’s and shareholders’ money, while banks won’t be able to collect debts.

Tisco has asked many times for help to solve these problems, which are now beyond the company’s competence. But the proposals have not received replies. 

Luong Bang

Foreign investors increase acquisitions of renewable energy projects in Vietnam

Foreign investors increase acquisitions of renewable energy projects in Vietnam

Foreign investors from China, Thailand, and Singapore are increasingly acquiring renewable energy projects located at strategic positions from domestic enterprises.

Local steelmakers red hot on investment

Local steelmakers red hot on investment

Over recent months, the steel market has retained positive momentum after its recovery in mid-2020, helping many steel producers record a strong performance in the first quarter of 2021.

 
 

Other News

.
PhD production plan: Will Project 89 go a new way?
PhD production plan: Will Project 89 go a new way?
FEATUREicon  19/05/2021 

Before launching Project 89 that aimed to produce 7,300 more lecturers with a doctoral degree, the Ministry of Education and Training (MOET) ran two projects on preparing human resources with doctoral and master’s degrees, worth trillions of VND.

Taxing rental apartments: lessors and lessees will face difficulties
Taxing rental apartments: lessors and lessees will face difficulties
FEATUREicon  18/05/2021 

Imposing tax on the leasing of apartments and business premises is not a new idea, but the method of taxation remains controversial.

Multi-billion VND apartment buildings unoccupied in central Hanoi
Multi-billion VND apartment buildings unoccupied in central Hanoi
FEATUREicon  18/05/2021 

Many apartment buildings in Hanoi have been left idle for many years, even while many people seek accommodations.

Ben Tre takes different approach to change its fate
Ben Tre takes different approach to change its fate
FEATUREicon  18/05/2021 

“What should we do – continue to complain about difficulties to get subsidies from the state budget, or become self-reliant to rise up,” said Ben Tre Provincial Party Committee Secretary Phan Van Mai.

Old discarded clothes turned into expensive products
Old discarded clothes turned into expensive products
FEATUREicon  15/05/2021 

All old things, from clothes and guitars to motorbikes, can be recycled into useful and highly aesthetic items thanks to talented artisans.

Female scientist wants to start public awareness campaign about organ donations
Female scientist wants to start public awareness campaign about organ donations
FEATUREicon  16/05/2021 

Dr Do Pham Nguyet Thanh, born in 1995, an expert at the Biomedical Research Center under the Pham Ngoc Thach University of Medicine, has been honored as one of HCMC 2020 Outstanding Young Citizens thanks to her active contributions to the community.

Land price hikes stop, but property remains expensive
Land price hikes stop, but property remains expensive
FEATUREicon  15/05/2021 

Though land fever has eased, prices are still high. The apartments in projects in advantageous positions are being offered at sky-high prices of VND300-400 million per square meter.

Hanoi advised to follow Japan’s urban railway model
Hanoi advised to follow Japan’s urban railway model
FEATUREicon  16/05/2021 

The Tokyo-Tshukoba urban railway line was funded by converting land in 18 projects along the route. The land price in these areas soared from $1 per square meter to $5,000.

Covid-19 vaccine and the gap between countries
Covid-19 vaccine and the gap between countries
FEATUREicon  16/05/2021 

The US announcement to support the waiver of IP protection on Covid-19 vaccine has not been the good news that was previously expected.

9-year-old pupil becomes national master of chess
9-year-old pupil becomes national master of chess
FEATUREicon  14/05/2021 

At the age of nine, Hanoi’s Dau Khuong Duy has been granted the title national master of chess.

Phu Tho woman finds husband after 13-year absence
Phu Tho woman finds husband after 13-year absence
FEATUREicon  14/05/2021 

Thanks to a video posted on Tiktok, a woman in Phu Tho province has found her husband who was missing for 13 years.

The path for Vietnam to become owners rather than just wage earners
The path for Vietnam to become owners rather than just wage earners
FEATUREicon  17/05/2021 

Technology and innovation are the answers to the question about how Vietnam can to escape from doing only outsourcing for foreign partners.

Prime Minister sets strategic direction for information and communications sector development
Prime Minister sets strategic direction for information and communications sector development
FEATUREicon  14/05/2021 

Prime Minister Pham Minh Chinh, during a working session with the Ministry of Information and Communications (MIC) on May 11, assigned tasks and set strategic development goals for the time to come.

Vietnamese enterprises lose their home market as they focus on land deals
Vietnamese enterprises lose their home market as they focus on land deals
FEATUREicon  15/05/2021 

Many enterprises would rather use their capital to buy and sell land than make investments to scale up their production.

Poor people lose chance to buy houses with funds from gov't preferential credit package
Poor people lose chance to buy houses with funds from gov't preferential credit package
FEATUREicon  13/05/2021 

As the VND30 trillion preferential credit package has ended, many realtors and clients have fallen into a difficult situation.

Brother-sister pair wins Asian championship in skating
Brother-sister pair wins Asian championship in skating
FEATUREicon  13/05/2021 

Falling passionately in love with ice dancing in childhood, the skating siblings Minh and Chi could not imagine that the sport would ever bring such honors to them.

With over US$1 billion, a new Vietnamese billionaire is revealed
With over US$1 billion, a new Vietnamese billionaire is revealed
FEATUREicon  13/05/2021 

The assets of the richest people in Vietnam have risen sharply in recent times. Many tycoons have earned huge recently.

Lessons from the Covid-19 'tsunami' in India
Lessons from the Covid-19 'tsunami' in India
FEATUREicon  12/05/2021 

Proactively protecting yourself, going out only when absolutely necessary, fulfilling medical declarations, strictly following the 5K message, and installing the Covid-19 tracking app Bluezone are the best ways to prevent the spread of Covid-19. 

Land fever: speculators spread rumors to push prices up
Land fever: speculators spread rumors to push prices up
FEATUREicon  12/05/2021 

Land prices recently soared by VND30-50 million per square meter in some places, but the number of successful transactions was modest.

Vietnam’s pho sold under Chinese brand, fish sauce marked with Thai brand
Vietnam’s pho sold under Chinese brand, fish sauce marked with Thai brand
FEATUREicon  12/05/2021 

Vietnam’s ST25 rice is at risk of having its brand stolen in the US and Australian markets. Losing brands is the heavy price that Vietnamese enterprises will pay for their inappropriate attention to trademark register.

 
 
 
Leave your comment on an article

OR QUICK LOGIN