Engineering Sector Seeks Development Strategy (17/02)
17/02/2012 - 13 Lượt xem
Currently, the sector meets about 30 percent of the demand among domestic projects. Statistics from the National Research Institute for Mechanical Engineering show that the sector has provided design consultancy for some thermoelectric
plants such as Ca Mau, Nhon Trach and Vung Ang. However, domestic
mechanical engineering companies still have to seek foreign assistance at the design stage. Although they are capable of manufacturing and assembling steel structures, Vietnam still has to import many types of machinery, including the main parts of production lines in thermoelectric and bauxite processing plants.
Nguyen Chi Sang, the director of the National Research Institute for Mechanical Engineering, said, "Currently, the domestic mechanical engineering sector does not meet practical demands and has to import many kinds of products. I think the situation can be improved and the sector should be able to meet 50 percent, not just 30 percent of domestic demand as at present." He gave some examples. The first
was a project aiming to expand a bauxite processing plant in Darwin,
Australia, to increase its annual processing capacity from 1.2 million
to three million tonnes with investment of more than US$2 billion. Most
types of machinery for this project were manufactured at the Chan May Port in Vietnam and then transported to Darwin. Most of engineers involved in the assembly of equipment for this project were Vietnamese. They worked under the guidance of Canadian and Australian engineers. The second
example is related to a hydraulic mechanical equipment manufacturing
program. Domestic companies taking part in this program have been
allowed by the Ministry of Industry and Trade to buy foreign designs and have manufactured hydraulic equipment for nearly 30 projects, including large hydropower projects at Son La and Lai Chau. The total value of those projects amounts to several trillion dong. Another example is the 90m self-lifting oilrig which was manufactured by PetroVietnam Marine Shipyard (PV Shipyard), a member of the Vietnam National Oil and Gas Group (PVN) and the National Research Institute for Mechanical Engineering according to basic design bought from the US. The manufacture of this oilrig finished in late 2011 and it was put into operation in early 2012.
Regarding the equipment for thermoelectric plants, Nguyen Chi Sang said that domestic mechanical engineering companies have been the EPC (Engineering-Procurement-Construction) contractor for the Vung Ang Thermoelectricity Project. The National Research Institute for Mechanical Engineering and the Vietnam Industrial Construction Corporation (Vinaincon) have been the EPC contractors for two sifting plants of the bauxite project in Tan Rai, Lam Dong. Vietnam has become the first Southeast Asian country capable of manufacturing 500kV transformers and it has put a transformer of this kind into operation in Ninh Binh Province.
So the potential exists, but what are the solutions to broaden this development?
Solutions
Nguyen Chi Sang partially attributed the Vietnamese mechanical engineering sector's limited growth to limitations of the Bidding Law. In his opinion, Vietnamese contractors cannot compete with their
Chinese rivals because Chinese companies can borrow bank loans at a
much lower interest rate (about six percent) and enjoy State support
when involved in exports. The second problem hindering the growth of the domestic mechanical engineering sector is a lack of an appropriate strategy to increase the local content of mechanical products. Another reason is that domestic companies still lack capital and cooperation.
To increase the competitiveness of domestic mechanical engineering companies, Nguyen Chi Sang said that the Bidding Law must be reviewed to be amended so that not only prices but also the local content of mechanical products will be taken into account in the bidding process. In addition, there
must be appropriate market protection policies to apply to some
projects with specific conditions during a specific period of time.
The manufacture of mechanical products requires large amounts of investment capital, while most Vietnamese companies remain small to medium in size and do not have enough capital to invest in manufacturing projects. President of the Vietnam Association of Mechanical Industry Nguyen Van Thu believes, domestic companies must cooperate with each other
and share bid packages and spending on equipment purchases to reduce
production costs and ensure better quality products. Nguyen Chi Sang
said that some mechanical equipment manufacturing projects are using
both foreign and domestic capital with foreign companies acting as the EPC contractors. There must be clear regulations which can prevent foreign contractors in such cases from dominating everything related to the projects (in some cases, foreign contractors even bring their manual workers to Vietnam). Domestic companies must take the initiative in buying foreign designs to manufacture the equipment for hydropower and thermoelectric plants, bauxite processing plants and oilrigs./.
Source: VEN
Source: VEN
