Taiwan’s Formosa and partners may have exaggerated May riot damage

August 29, 2014 | 16:30

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Hung Nghiep Formosa Ha Tinh Steel Limited Company (FHS) and its contractors in Formosa Plastic Group’s steel and Son Duong deep-water seaport complex in the central province of Ha Tinh may have overstated the value of the damages caused to them by the riots in May.

Formosa Ha Tinh project - photo source TienPhong

During a first check, the Ha Tinh People’s Committee discovered in some of the damage reports submitted by firms that some of the facts didn’t check out, such as the amounts of steel, wood, electrical wires and machinery stolen.

From the reports, the province’s damage assessment committee valued direct damages to FHS and its contractors at VND616.5 billion ($29.2 million), of which direct damages to FHS were valued at VND13.5 billion ($640,000). FHS and its contractors initially reported combined damages of VND4.934 trillion ($208.2 million). Their reports did not segment out direct and indirect damages.

“The financials submitted by the firms have not yet been checked,” said a representative of the province, “as the firms have not yet submitted any documents to back up their claims.”

The province has asked FHS and its contractors to soon provide these documents, and asked FHS to work with its insurance companies to determine which of the damaged assets are covered and then report back to the committee.

Of the 86 contractors working on the $10 billion complex, 59 reported damages from the riots that occurred in mid-May following China’s illegal placement of an oil rig within Vietnamese waters.

Ha Tinh has punished 38 individuals for causing unrest, as well as retrieved some of the stolen equipment. It has also taken a raft of measures to support damaged firms, including asking Viet-Lao Vung Ang Port JSC to reduce its port rental fees for FHS goods and the customs department to accelerate procedures for the import of FHS machinery and equipment.

By By Hoang Nam

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