Phuc Son Cement under investigation

Phuc Son Cement under investigation

According to the inspection report that the State Audit of Vietnam (SAV) has submitted to the prime minister and the Chairwoman of the National Assembly of Vietnam, Phuc Son Cement’s exploited mineral volume exceeded the volume it initially licensed in 1996.

Besides, local authorities determined that Phuc Son Cement does not have the professional competence to exploit mineral from mines and it currently has to hire organisations and individuals to manage mining exploitation.

However, Phuc Son Cement has used out-dated technology to exploit resources, causing serious environmental pollution.

In addition, during the auditing process, the authorities found Phuc Son Cement less than cooperative. Notably, the firm refused to supply the necessary documents and was even found to have revised a number of documents and dossiers.

Furthermore, SAV added that the Haiphong Department of Natural Resources and Environment made an oversight in the management of mineral exploitation and tax payments of Phuc Son Cement.

Notably, the department has yet to scrutinise the exploited mineral resources as well as the firm’s business report. In addition, in 2009, the Thuy Nguyen District People’s Committee in the northern port city of Haiphong found that the firm illegally exploited national resources, however, the authority has yet to take appropriate steps.

According to the State Audit, the firm shows signs of violation and estimated that the firm will have to pay VND266.6 billion ($11.69 million) in natural resources tax and environmental protection fees, among others. However, Phuc Son Cement is a foreign-invested firm, thus, in order to ensure transparency, the State Audit will send the inspection results to Haiphong’s public security department to clarify its violations.

In January 1996, Taiwan Lucky Cement Corporation was granted the investment certificate to develop the Phuc Son Cement plant with a total investment capital sum of $265 million. The plant started commercial operations in May 2005 with a designed capacity of 1.8 million tonnes per year. The entire production line of the project was contracted, designed, inspected, and tested in accordance with Chinese standards, mainly using Chinese equipment.

Being considered one of the largest foreign-invested cement production plants in Vietnam with 14 per cent of the market share (March 2016), Phuc Son Cement is also rather notorious. Notably, the company was fined for VND360 million ($15,794) and suspended for three months due to environmental violations.

Besides, in August 2014, there was a rock landslide at the company’s mine, killing five workers. In addition, residents living in the neighboring area of the plant complain a lot about the environmental pollution caused by the rock exploitation activities of the firm.

In September 2014, Lucky Cement Corporation expressed intentions to develop a 51-hectare site on Hoang Tan Island in Quang Yen district. The project comprises of a golf course, luxury hotel, service and entertainment facilities, and a park. The total investment could reach $1 billion. However, to date, there has been no further information about this project.