Facing great difficulties in production and consumption, the Cement Association proposed that the Prime Minister take measures to support and avoid the risk of businesses going bankrupt and selling themselves.
Reporting to Prime Minister Pham Minh Chinh, the Vietnam Cement Association said that from 2022, cement consumption has been continuously decreasing. Last year, domestic consumption was only 84% compared to the same period in 2022 (domestic consumption reached 56.6 million tons, export 31.2 million tons). Meanwhile, Vietnam has 61 factories with a total designed capacity of about 117 million tons of cement per year.
"The cement industry is facing great difficulties in production and consumption, businesses are at risk of bankruptcy or selling part of their factories to foreign countries," the Association said.
In fact, this is not the first time cement companies have called for help. Late last year, along with seven other associations in the construction materials industry, the companies reported their precarious situation.
Clarifying the bottlenecks, the Cement Association said that the difficulties come from weak domestic consumption demand and slow implementation of public investment projects. Road construction projects, including highways, still use traditional technology, the application of reinforced concrete highway overpasses is still limited, and the solution of using cement to reinforce and stabilize the ground has not been applied.
The housing and real estate market has not recovered, the rate of social housing investment projects actually implemented is very low.
Meanwhile, businesses are facing difficulties in production due to rising fuel and energy prices, especially coal prices. Clinker export tax has increased, and environmental pressure on cement factories is increasing.
In order to help businesses overcome difficulties, the Vietnam Cement Association has proposed that the Prime Minister and ministries and sectors find ways to increase domestic consumption by building overpasses instead of reinforced concrete roads, especially in areas with weak soil or areas that need flood drainage such as the Central region and the Mekong Delta.
The government should also consider reinforcing the roadbed with cement-soil to replace the traditional solution of filling the roadbed with sand, the Cement Association said.
The Association also proposed that the Government soon submit to the National Assembly for approval the removal of export tax on clinker. In the short term, if not removed, the Association proposed to keep the export tax on clinker for the next two years at 5% and deduct VAT.
They also asked the Prime Minister to direct banks to extend debt repayments and reduce interest rates for cement businesses, and discourage foreign investors from pouring capital into cement projects in Vietnam.
Duc Minh
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