VIETNAM: Taiwanese businessman's US$160 million deal in Vietnam

A Taiwanese businessman's US$160 million investment in a cement factory in Vietnam may go down the drain because of a policy flip-flop by a local government, but Taiwanese authorities are trying to help salvage the situation.

Huang Chi-peng, Taiwan's representative to Vietnam, has written letters to Vietnamese officials from Prime Minister Nguyen Thi Doan on down, urging them to solve the dispute or face the prospect of Taiwanese businesses losing interest in investing in the country.

Chen Liang-chuan, the founder of Taipei-based Lucky Cement Corporation, poured US$160 million into He Duong Cement Company in Ninh Binh in 2008 after being awarded the right by the local government to mine a nearby 72-hectare limestone field for 49 years, according to Taiwan's representative office in Hanoi.

The investment project was then approved by Prime Minister Nguyen Thi Doan and related ministries at the time and was made a part of Vietnam's 2020 Cement Industry Development Plan, Huang said.

But just as the plant's two new production lines with a total capacity of 4 million tons of cement a year were set to begin trial runs, the local Ninh Binh government rejected He Duong's request to begin exploiting the field.

The Ninh Binh government explained that it designated the field as part of the Trang An Scenic Landscape Complex before applying to UNESCO in September this year to have the complex recognized as a world heritage site, according to Huang.

The Ninh Binh government's decision, which was made without consulting the company, has deprived the company of the limestone it needs to run its plant and rendered Chen's investment useless, Huang said.

According to the diplomat, He Duong is unable to produce cement but still has to service US$23,000 in interest on bank loans every day.

In Taipei, sources at Lucky Cement Corporation said Vietnamese authorities are trying to find another limestone mine to replace He Duong's original field, but they worried that a new mine locati