Formosa Plastics Group (FPG, 台塑集團) yesterday said that one Chinese employee at its steel mill in Vietnam’s Ha Tinh Province died during a riot by striking workers on Wednesday and 90 others were injured, but none of its Taiwanese or Vietnamese employees were hurt.
Anti-China protests in Vietnam over Beijing’s deployment of an oil rig in the South China Sea last week flared up in the several provinces on Tuesday.
A subsidiary of the group — the largest industrial conglomerate in Taiwan and one of the leading foreign investors in Vietnam — the Formosa Ha Tinh Steel Corp (台塑河靜鋼鐵興業) is building a steel mill in Ha Tinh, which is scheduled to become operational in the second half of next year with an annual production capacity set at 7 million tonnes.
Photo: Reuters / Vnexpress
Hundreds of Vietnamese workers at the plant staged a strike on Wednesday, which turned violent, the group said in a statement.
“Office equipment and manufacturing facilities at the plant were damaged on Wednesday afternoon following fighting between the plant’s Vietnamese and Chinese workers,” Formosa said in the statement. “The violent attacks, arson and looting quickly spread to houses outside the plant for Chinese workers.”
The head of the Ha Tinh provincial government arrived at the steel mill at 10pm and held an emergency meeting with guards and public security chiefs, the group said, adding that the rioters were dispersed late on Wednesday night.
Photo: Reuters / Vnexpress
The steel mill is one of hundreds of factories run by Taiwanese businesspeople in Vietnam that have been affected by the anti-China riots in that country, the Ministry of Economic Affairs said yesterday.
“More than 100 of these factories were invaded by rioters, while 11 were set on fire,” Vice Minister of Economic Affairs Shen Jong-chin (沈榮津) told reporters.
Another 400 factories have opted to suspend operations out of safety concerns, Shen said.
Ministry statistics show property damage has been reported at 73 factories, including 15 shoemakers, 14 bicycle part and component manufacturers, 10 textile and garment makers, seven furniture makers, four electrical appliance makers and three publishing and packaging manufacturers.
The financial damage has not been determined, as some investors need to return to their factories to assess the situation, but the footwear sector appears to have suffered heavier losses than other sectors in the unrest, the ministry said.
Taiwanese firms have made 2,301 investments in Vietnam with a total value of US$27.3 billion, making Vietnam the fourth-largest overseas investment destination, according to ministry statistics.
Most of the violence from the strikes and riots that erupted on Tuesday has been reported in Binh Duong Province, where many Taiwanese investors operate, while Dong Nai Province was less affected.
Tire manufacturer Kenda Rubber Industrial Co (建大輪胎) and bicycle-chain maker KMC Kuei Meng International Inc (桂盟國際) yesterday said they were planning to resume operations in Dong Nai Province, east of Ho Chi Minh City, later yesterday or today, as the protests had had a limited impact on their operations.
Meanwhile, the Financial Supervisory Commission yesterday asked domestic financial institutions to extend loans to companies with operations in Vietnam that have been damaged in the protests.
Companies with new lending demands for Vietnamese operations may apply for loans from the Overseas Chinese Affairs Commission, the commission said, urging banks to take the initiative and lend a helping hand.
The commission has written letters to Vietnam’s central bank and financial regulators, asking them to help Taiwanese financial institutions maintain normal operations.
There are 10 Taiwanese banks with branches in Vietnam, nine representative offices and one subsidiary, the commission said, adding that they have NT$70.5 billion (US$2.33 billion) in exposure.
In other developments, Minister of Finance Chang Sheng-ford (張盛和) yesterday told lawmakers that the government will allow Taiwanese companies operating in Vietnam to declare their losses from the protests and riots as deductible expenses for income tax purposes as much as possible.
“As long as these firms provide photographs or documentation as proof of damage, we will see if these losses are able to be deducted, with lenient evaluation,” Chang said during a question-and-answer session in a meeting of the legislature’s Finance Committee.
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