Alcan Inc, the world’s second-largest aluminium producer, has accelerated a shift in manufacturing production to a new plant in Vietnam from one in Thailand, Vietnamese officials said on Friday April 14.
Alcan has started building the plant to make pre-assembled modules used in aluminium production in the central province of Thua Thien-Hue and will ship them to a facility in Australia, said Phan Canh Huy of the provincial Planning and Investment Department.
Work on the plant in Vietnam began in early February and Alcan received its investment licence on March 16. Huy said the licence was for phased investment, with initial paid-up capital of US$4.8 million.
“The total investment for the first year was set at US$20 million,” said Nguyen Huu Tho, director of the Chan May-Lang Co Economic Zone which houses Alcan’s plant. “But the company’s material delivered so far is already worth around US$40 million.”
Alcan officials were not immediately available for comment.
Tho said political uncertainty in Thailand, where prime prime minister Thaksin Shinawatra stepped aside last week after failing to secure a resounding endorsement in a snap April 2 general election called to neutralise mass opposition street protests, had been a factor in the rapid start for the new plant.
He also said Alcan would soon send around 300 Thai workers to help production, given not all of the local workers were trained.
Alcan’s plant in Chan May-Lang Co economic zone, about 700 kilometres (435 miles) south of Hanoi, is near a deep-water sea port that is capable of handling large vessels, officials said. All businesses set up in the zone are exempted from corporate tax, they said.
Foreign direct investment pledges in Vietnam during the first quarter of this year jumped 24.4% from a year earlier to US$1.63 billion, government figures show.
Finance minister Nguyen Sinh Hung said last month that Vietnam needed to raise US$150 billion in investment between 2006 and 2010 to fuel economic growth, and Hanoi expected 35% of the funds would come from foreign investors.