VietNamNet Bridge – The mammoth $4.5 billion steel project, which was considered the pride and hope of Quang Ngai province, has turned out to be a big disappointment as it has not taken any move forward so far.
The Quang Nam provincial authorities have released the decisions to revoke the licenses granted before to 12 investment projects because of the investors’ slow implementation.
The drastic moves taken recently by local authorities show Vietnam’s determination to “clean up” the investment environment. The Guang Lian – Dung Quat steel project in Quang Ngai province is believed to have the same fate, since it has been immovable over the last six years since the day of licensing.
However, it’s not an easy case, while the Quang Ngai provincial authorities still don’t know what to do with it.
Other localities might be very jealous of Quang Ngai province when it attracted a huge investment project to the local Dung Quat Economic Zone in 2007. The project, promised by Tycoons and E-United had the initial investment project of $1.05 billion, which later was raised to $3,3 billion after the project changed its name to Guang Lian – Dung Quat, and then to $4.5 billion.
However, after the impressive ground breaking ceremony was held, the project has been immovable over the last six years. In the latest news, the investor, Guang Lian, which has cooperated with Japanese JFE, has asked for the permission to delay the project implementation until July 2014.
The land area reserved for the steel project remains a deserted land with several concrete stakes, while the mill area has been used by local farmers to tend oxen.
The dilemma
In order to have clear land for the project, about 700 hectares after many times of the project scale adjustment, the local authorities had to take a large land area from local people.
Especially, in order to create most favorable conditions for the investor, the local authorities allowed the investors to use the Doc Soi – Dung Quat Road, the main road that links to the port, while a new road has been built for people’s use.
The Guang Lian – Dung Quat is an A-class project, which means that the Quang Ngai provincial authorities have to spend big money to clear the site for the project and give clear land to the investors. Meanwhile, big investment incentives have been offered by the local authorities which hoped that the project, once operational, would create thousands of jobs.
However, to date, the local people have not got any benefits from the project. They, after receiving the compensation from the local authorities, have become redundant because of no land for cultivation.
Le Xuan Dung, Deputy Head of the Dung Quat Economic Zone’s Board of Management, admitted that the board does not trust in Guang Lian any more. However, he said, the local authorities have been put in the dilemma: it’s impossible to stop the project, while it’s very difficult to continue it.
Though repeatedly breaking the promises on the project implementation, the investors have recently demanded 23 hectares of land more, which is located in a newly licensed port area.
The latest promise by the investor to kick off the project in July 2014 has once again, brought hope to the local authorities. However, no one can say for sure if the investors, who many times broke the promises over the last six years, would fulfill what they have committed.
Nguyen Nguyen