At the recent session held by Vietnam Competition Authority (VCA) under the Ministry of Industry and Trade (MoIT) to gather opinion from parties related to the investigation to decide whether to apply anti-dumping tariff on some polyurethane-coated steel sheet and vinyl-coated metal (PCM/VCM) products, big appliance manufacturers asked to get PCM/VCM imported in order to make electronic appliances out of the scope of the tariff and give them a separate HS code, otherwise they would reconsider their investments in Vietnam.

A possible cost hike

Samsung Electronics HCMC CE Complex (SEHC) said this kind of PCM/VCM is different from the kind used in construction in both technical specs and purpose, so they do not cause harm to the domestic industry.

It said that the anti-dumping tariff, if applied, will make the company’s goods less competitive globally, and will limit the possibility of the company raising investment in Vietnam.

SEHC estimated that the tariff would increase costs by about $25 million. “We proposed leaving PCM/VCM out of the scope of the anti-dumping tariff. We will work with the MoIT on controlling imports,” the company said in its speech at the session.

LG Electronics Vietnam Haiphong said the PCM/VCM it is currently importing is not yet produced domestically. 

The domestically produced version does not meet PoHS standards and the technical specs the company needs, while imported PCM/VCM is more durable.

LG has been importing zinc-coated unalloyed steel sheets (PCM/VCM), with the HS code 7210.7010 from China and South Korea in order to produce washing machines. 

Though domestically produced and imported goods have the same HS code, according to the company, the technical specs are largely different. LG proposed the same as Samsung.

A representative from Panasonic also said that there should be another HS code for PCM/VCM used to produce appliances and it should be excluded from the scope of the anti-dumping tariff, explaining that the PCM/VCM produced domestically for construction does not meet PoHS standards and cannot be used to produce refrigerators.

Panasonic said it planned to export more products made in Vietnam, to destination like Japan, but the anti-dumping tariff would force them to reconsider these plans and they may have to move the factory to another Asian country.

Plight of domestic players

Nghiem & Chinh Law Office proposed a 30 per cent tariff to be implemented for the duration of four years. 

The firm and steel companies that supported this tariff said that in 2013-2015 there was an unusual growth in colour-coated steel imports and there were signs of significant harm to the domestic industry.

In 2015, the total revenue of colour-coated steel producers decreased by 11 per cent on-year. Production costs rose by 4 per cent. 

Net profit per product unit decreased by 82 per cent. 

The market share of domestic companies decreased by 10.66 percentage points. In 2013-2015, the decrease was an annual 8.5 percentage points on average.

Inventory in 2016 also rose 3.5-fold of the 2013 volume, to 120,000 tonnes. Due to competition from imports, the price of similar domestically-produced colour-coated steel products decreased sharply in 2013-2016. In 2016, the price decreased by 35 per cent on-year.

Vietnam Steel Association (VSA)’s data showed that in 2016 imports of colour-coated steel was 592,860 tonnes, up 91 per cent on-year and 357 per cent compared to 2013. 

The VSA also proposed the MoIT to consider the tariff in order for the Vietnamese steel industry to grow sustainably.

VIR