VAST- Bauxte Exploitation in Viet Nam


                                     SOME FACTS ABOUT



1. A Project full of Irregularities and Violations

The right of bauxite exploitation in Tan Rai and Nhan Co in the highland region of Central Vietnam was offered to China through the back door. The total money Vietnam invested in the project amounts to 926 million US dollars at the beginning of the project in 2008.

In 1991, Vietnam and China reestablished their relation after the breach of ten years. Since the collapse of the Soviet Union and  Eastern Europe, China and Vietnam came closer to each other than ever before for their survival.

To strengthen their consolidation, Vietnam and China resort to arbitrary and treacherous means at the expense of the Vietnamese people. On May 6, 2009, when Nguyen Tan Dung, prime minister of Vietnam was attending the G20 Summit Meeting in London, David Pilling, a reporter of the Financial Times in London wrote that the bauxite exploitation is just a present gift to China as a tribute.

2. A Hasty Project

After the discovery in 2005 of the huge bauxite site estimated about 5 billion tons, Chinaimmediately pressured Vietnam to sign the contract for its exploitation. In 2006, when Hu Jing Tao, President of the People Republic of China, attended the Asian Pacific Economic Council (APEC) in Hanoi, the communist Vietnamese handed him a list of projects including the bauxite project, to be implemented in cooperation with China. On the other hand, Vietnam started establishing Vinacomin, a state owned company, with a capital of 15 billion US dollars without the knowledge of the National Assembly, the people, the experts and the media until Chinalco, a Chinese company started the project in Tan Rai.

3. A Careless and Unscientific Project

Usually such an enormous project requires preliminary studies on environmental, economic, social, and cultural effects at the local, regional and national levels. Vietnam did not carry out such requirements. Actually, the project has been given to China six months before the Vietnamese Politburo requested a study on the environmental, cultural, economic, and social consequences on the exploited area.

4.  Destruction to the Ecology and Environment

The site to be exploited covers the whole area of the highland region. The six projects in Dak Nong alone covers one third of the region. They extended to the populated area where coffee, rubber plants, and tea are grown. However, the government claims that those areas are undeveloped land. The top layer of the exploited land would be washed away in so large amount that there would be no soil available to fill it up. Moreover, it would be impossible for vegetation to grow on the exploited area in a near future because of the polluted soil, surface water, ground water, and air.

5. Economic Unprofitability

 The cost of production could not be estimated accurately due to the hidden factors such as the cost of transportation. At the same time, the price of aluminum of the world market drops during the global recession. At the beginning of the project, the loss could be $50 to $60 per ton. At the early phase of the project the production might reach two million tons of crude aluminum per year. China brought to the site obsolescent machinery that was discarded in China. The use of such equipment reduces efficiency and, hence, raises the primary cost. In addition, the level of expertise of the Chinese is far below that of the American, the European, the Australian, and the Japanese. In this case the Vietnamese could hardly learn the modern techniques and experiences from the Chinese counterpart.

The project violates the investment law of labor. Section 25 of the law of investment of Vietnam indicates that unskilled and semi-skilled workers from other countries shall not be allowed to be employed in Vietnam.

6. On the International Level

Some nations and international organizations such as the World Bank and the WTO that lend money to Vietnam find the lack of transparency regarding international investment in that country. In October 2009 Finland and Norway sent their representatives to Vietnam to observe the case and recommended a review of the case because of the disadvantages on the part of Vietnam, and particularly due to the potential impacts to the minorities living in the region.

Alcoa, the largest American aluminum company in the world withdrew their bidding from and their cooperation with Vietnam after realizing that the transaction was not transparent.

7. National Security and Sovereignty Threatened

The presence of thousands of men coming from China as hired workers is a real threat to the local inhabitants. They live separately in their own quarters. The local authorities dare not interfere. It is predictable that China will send troops and intelligence agents in disguise as workers.

8. Danger of a Conspiracy

Transactions between countries are normal as far as they are carried out in accordance with the conditions acceptable to both countries with specific and clear objectives. However, this is not the case. That is the reason why the current project has brought out serious problems and grave concerns among the Vietnamese people.

Facing such gross violations and dangers caused by the bauxite exploitation, the Vietnamese people do not have any means and power to change the course as other peoples in the free world do. It is predictable that subsequent events may follow such as further investments, exploitations, market manipulation, and for the worst, political and military involvement. A tragic new world order may happen in a near future if other countries and world organizations implicitly remain silent.




Nguyen Ba Loc, MS                                                Mai Thanh Truyet, Ph.D

President, VAST                                                     Chairman, VAST