Vietnam National Oil and Gas Group (PetroVietnam-PVN) has recently held a workshop on investment promotion in an attempt to introduce to Japanese partners an array of projects and opportunities in five major business areas.
Some 25 projects have been brought forward at the seminar, of which six are in oil and gas searching and exploitation; seven are in an oil refinery and petrochemicals; nine are in the electricity industry and two are in seaport construction.
Deputy general director of PVN Nguyen Tien Dung affirmed commitments to assist Japanese investors in working with the local authority agencies. “Investment efficiency must be given the top priority, yet unreasonable queries could hardly be acceptable”, he added.
For instance, Nghi Son Oil Refinery and Petrochemical Complex Project in which Japanese investors contribute 40pct of the total investment capital has recently failed to see much progress. The sluggish performance could be put down as the foreign partner’s request for foreign exchange guarantee ratio of 100 percent rather than 30 percent as presently stipulated.
The workshop saw plenty of their concerns over corporation method, the government’s assistance such as the guarantee of projects and foreign exchange which indicated their prudence in grabbing this opportunity.
Also, despite investment promotion delegations to Japan, Korea and the US in the recent time, barely have any remarkable corporation agreements have been signed since 2010 implying significant challenges in fulfilling this giant’s plans. Notably, many of them are large-scale projects that would require billions of dollars or USD 400 million -500 million at least. What is more, the global economy has yet fully revived leading investors to be extremely cautious with any investment decision.
In fact, even two large projects with foreign investors’ involvement Nghi Son Oil Refinery and Petrochemicals Complex and Southern Petrochemical Complex have been experiencing postponement.
Southern Petrochemical Complex which was kicked off four years ago has yet seen much advancement. Recently, the Vietnamese partner Vinachem which contributes 11pct of the total investment capital of USD 4.5 billion has withdrawn from the project.
Similarly, provisions on finance and guarantee for Nghi Son Oil Refinery and Petrochemical Complex with USD 7 billion investment capital, of which PVN holds 25pct has not by far been finalised so as for the construction stage to commence.