Illegal ore exports on the radar once again.
illustration photo But, it was extremely hard to procure exact figures on illegal mineral export volumes due to its complexity, according to the head of the Ministry of Industry and Trade’s Department of Heavy Industry Nguyen Manh Quan.
“There are sophisticated smuggling tricks. Poor people in diverse mountainous areas take the trading of ore as their sole means to make a living, whereas ore trade is brisk in cross-border areas where people can sell every kind of ore,” Quan noted.
In reality, not only residents are involved in ore smuggling, mining businesses also engage deeply in illegal ore export.
The director of a mining company based in northern Haiphong city said sourcing output markets for minerals remains the largest hindrance to mining firms, prompting them to export despite the current overly high export duty of 40 per cent.
“Our firm willingly rolls out the red carpet to local businesses who want to buy our ore. When we offer to sell ore to firms, they practically turn their back on us,” said the director.
Steel-maker Hoa Phat Group (HPG), a single business which buys ore in huge volumes, began to buy ore from local firms from 2008 as it needed around 60,000-70,000 tonnes of ore per month to feed production as HPG could not meet 30 per cent of their demand.
Demand could double to 150,000 tonnes per month when its second blast furnace goes on line, according to an HPG source.
The source also said HPG had factored on price levels in China’s Feng Cheng area when purchasing ore from local mining firms. Since HPG often pays in advance, it has succeeded in many deals with local firms.
Commenting on why local firms were not eager to sell ore on the domestic market, the chairman of Vietnam Steel Association Pham Chi Cuong said that in HPG’s case, since it was a listed company, transactions needed full document sets, which not all mining firms could provide.
In addition, there has been a rash of cases reported of mining firms entering into illegal deals with supervisory bodies to evade tax.
By Thanh Huong
Đăng ký: VietNam News