Vietnam is scrapping plans to build two nuclear power plants over soaring costs and safety concerns, state media reported yesterday.
Hanoi approved plans to build the plants in 2009 in Ninh Thuan Province with an eye toward easing energy shortages brought about by its rapidly industrializing economy.
They were scheduled to have a capacity of 4,000 megawatts, developed with assistance from Russia’s Rosatom and a Japanese consortium, and would have been the first nuclear plants in Southeast Asia, but state-run media reported that the government has asked the Vietnamese National Assembly to suspend the projects.
“The total investment has risen too high,” Vietnamese National Assembly Committee for Science, Technology and Environment Vice Chairman Le Hong Tinh was quoted as saying by the Tien Phong newspaper.
He said the proposed cost of both plants had doubled since 2009 to an estimated US$18 billion as the government sought more advanced technology following Japan’s deadly Fukushima Dai-ichi nuclear power plant disaster in 2011.
Tinh added that the projects could also pose an environmental threat and said the nation could not afford to risk another disaster after a toxic industrial leak triggered mass fish deaths earlier this year.
The leak ravaged local fishing economies and was pinned on a steel plant in the area run by Taiwanese conglomerate Formosa Plastics Group (台塑集團).
“After the Formosa accident, we are paying more attention to risk and safety factors... we need to be more prudent. It is time and necessary for us to stop,” Tinh said.
The plants’ proximity to island chains in the disputed South China Sea, most of which are claimed by Beijing, was an additional concern, he said.
Vietnam has said it would buy power from neighboring nations and it is also looking to boost its own energy production.
The nation of 93 million relies mostly on coal and hydropower, but has said it wants to increase renewable energy production in the next 15 years.
This week it announced a US$2.2 billion deal with Ireland’s Mainstream Renewable Power to build three wind farms in the nation.
Separately, Vietnam expects economic growth to accelerate next year as it boosts domestic businesses to shield the economy from worsening global uncertainty following the election of Donald Trump as US president.
“Trump’s victory adds uncertainty to international financial markets and global trade would be affected,” Vietnamese National Financial Supervisory Commission Chairman Vu Viet Ngoan said in an interview on Thursday.
The commission advises Vietnamese Prime Minister Nguyen Xuan Phuc on the economy.
“We will rely more on the local market and we need to boost the domestic sector even more,” Ngoan said.
Asian economies face significant risks should US president-elect Trump follow through his campain policies of imposing trade barriers and opposing the Trans-Pacific Partnership (TPP) — a 12-nation preferential trade agreement that covers about 40 percent of the global economy.
Economists have said Vietnam’s export-dependent economy would be one of the biggest beneficiaries among TPP nations.
Vietnam is aiming to spur economic expansion to 6.7 percent next year — a target that is still possible, Ngoan said — from a forecast of 6.3 percent this year.
“We expect the private sector to become the main driving force for faster economic growth next year,” Ngoan said. “We also foresee some improvement in the supply side of the economy, with increases in manufacturing output and services” as companies boost investment in factories.
Additional reporting by Bloomberg
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