The Vietnamese government will not sacrifice the environment to foreign investment, Deputy Minister of Planning and Investment Dang Huy Dong affirmed at a press meeting in Hanoi on June 30 where Taiwan’s Formosa
was blamed for causing mass fish deaths in the central coast.
The statement was made as Vietnamese authorities have come under pressure to show that foreign investors are not welcomed without controls.
Tons of fish and marine species mysteriously washed up along 200 kilometers of the coastline in Vietnam’s four central provinces in early April. Over 100 domestic and foreign experts joined an investigation to find out the cause to the fish kill.
They found phenol, cyanide and ferrous hydroxide exceeding the allowable limits in waste water discharged by a steel mill of Formosa in the Vung Ang Economic Zone in Ha Tinh
“Violations and incidents in the construction and trial operations of the plant are the causes for serious environment pollution killing a massive amount of fish in the four provinces from Ha Tinh to Thua Thien-Hue in April,” Minister-Chairman of the Government Office Mai Tien Dung said at the meeting.
Chairman Chen Yuan Cheng of Formosa Ha Tinh Steel Corp (FHS), a subsidiary of Taiwanese conglomerate Formosa Plastics Group, made a public apology in a video played at the briefing.
Chen Yuan-Cheng, chairman of Formosa, delivers an apology in a video clip, in Hanoi on June 30, 2016. Photo: Hoang Dinh Nam/AFP/Getty Images
“Our company takes full responsibility and sincerely apologizes to the Vietnamese government and people for causing the environmental disaster which seriously affected the livelihood, production and jobs of the people and the sea environment,” he said.
The firm, which has invested $10.6 billion to build a hot-rolled steel plant and a port in the zone, has pledged to pay $500 million in compensation for the disaster.
Legal Action in Consideration
Asked by reporters if FHS would be prosecuted, Minister Dung said that Formosa’s admission of guilt might be enough to avert that.
“Vietnam is building an investment environment, an image of integration and participation in trade agreements, and highly appreciated by foreign investors,” he said.
However, as FHS has taken responsibility and committed not to repeat similar mishaps, the Vietnamese government will consider whether to take a legal action or not, he added, asking for generosity from the people.
Voices against Polluting FDI Projects
A number of economists and experts in Vietnam have raised concerns about environment impact of foreign-invested projects in the country, which has been a driver for its fast-growing economy.
From left to right: Prof. Nguyen Mai, Nguyen Tran Bat, Pham Chi Lan.
Nguyen Tran Bat, chairman of InvestConsult Group, told BizLIVE that the $500 million to be paid by Formosa is “insignificant” to repair the environmental damages when comparing with over $20 billion the UK’s BP Group has had to spend to deal with consequences of an oil spill in the Gulf of Mexico that occurred in 2010.
“$500 million is just a small sum and can be used up in the initial phase of a program to fix environmental consequences,” he emphasized.
If the Formosa steel mill comes into official operation, it will discharge more waste into the sea and its discharge cannot be totally treated, Mr. Bat added.
Prof. Nguyen Mai, chairman of the Vietnam Association of Foreign-invested Enterprises (VAFIE), suggested the government review projects that can potentially pollute the environment in order to avoid similar incidents.
After this disaster, the government should stop or limit a number of projects that are in excess and not environmentally friendly such as those in the petrochemical, steel, cement and garment and textile sectors.
Nguyen Tran Bat commented that there was no need to change the policy to attract foreign direct investment (FDI), but the government should enforce laws strictly.
However, economist Pham Chi Lan, a former advisor to the prime minister, said that a change in policy is a must to prevent projects that have high risks of polluting the environment.
In addition, the government should care about national sovereignty and future generations, she added.