The WTO opening-up policy created favorable conditions for attracting foreign investment
into the steel industry. Many steel companies invest in Vietnam steel industry because Vietnam has a framework legal compliance with international practice combined with other factors such as low labor costs,unclear environmental regulations, etc. The projects put into operation help reduce the unbalance in flat production.
In addition, the increase in supply and increase in competition among steel industry help eliminate the weak business in the industry.
On the other hand, large steel companies in the world (Posco, Tata etc.) invest in Vietnam pull by adopting advanced technology, it helps to distance the technology applied in Vietnam steel industry against the world gradually reduced.
In addition, the steel industry faces a major challenge of internal competition and competition with the industry steel imports from China are becoming fierce, as well as the need to invest in technological innovation with the growing business. In the past few years, the state has maintained business steel industry through the adjustment of the reduction of import tax on iron and steel and raw materials if the fluctuation of steel industry disadvantage for businesses. However, according to the association commitment WTO accession from 2014, the tariff rate will be stable (average iron and steel products 13%). At that time, domestic enterprises must really grow both in financial potential new technology and product quality can compete with imported steel, especially steel imports from China
Policy of tax
The basic taxes of the steel industry are import duties. However, the tax policy related to steel industry is constantly changing, rising, decreasing, based on the recommendations of businesses and the proposal of the Vietnam Steel Association, from early 2008 to now have adjusted 5 times import taxs. This creates uncertainty, bringing many worries for the manufacturing enterprises export business in the industry. In our opinion, the state should not often change the import tax, which should be kept at a stable level or with a roadmap for specific changes enterprises are not passive in production and business activities and self-motivated the market.
