FPG to be compensated for Vietnam losses: report
By John Liu ,The China Post Wednesday, July 23, 2014, 12:15 am TWN
TAIPEI, Taiwan -- According to Vietnamese media, Formosa Plastics Group (台塑) will be compensated US$2.397 million in total for its losses incurred during anti-Chinese unrest in Vietnam, US$952,000 of which will be shouldered by insurance companies, while the government will give compensation of US$1.445 million.
Vietnam's Ministry of Finance and authorities in Ha Tinh Province recently held a ceremony to express their willingness to compensate foreign companies that suffered losses during the anti-China riots.
The Vietnamese government will also dispatch between 300 and 400 security personnel to guard FPG's Formosa Ha Tinh Steel Corp., in an effort to help the company churn out stable production.
FPG is keeping a low-profile stance on the issue, and said that an active negotiation is under way in order to resume the plant's operation. With assistance from both the Vietnamese and the Chinese governments, the company hopes to resume operations as soon as possible, FPG said. Most of the plant's workers come from mainland China, who fled back home during the riots.
According to a manager of FPG, the company expects to receive the money from the government later this week.
Vietnam Eager to Repolish Manufacturing Hub Image
The Ha Tinh facility has not been fully constructed. However, upon completion, it will become the largest steel plant in Southeast Asia.
Vietnamese officials pointed out that the government had strived to establish a secure and convenient investment environment for foreign companies. Insurance companies have been instructed to continue talks with companies that suffered losses to ensure they receive compensation promptly, officials said.
Analysts say that the local government is trying to repolish its image as the manufacturing hub in Southeast Asia. By doing this, the government wants to prove that the province is always ready to help and be a supportive companion for companies operating in the territory, said Dang Quoc Khanh, deputy chairman of Ha Tinh Province.
Compensations to Other Foreign Firms
Vietnam's Ministry of Finance and authorities of Dong Nai Province and Binh Duong Province had previously requested insurance companies to pay a total of US$7.316 million to compensate 148 firms that suffered losses during the riots.
The anti-China riots broke out after China moved an oil rig to the Paracel Islands located close to Vietnam. Both China and Vietnam claim authority over the Paracel Islands. The anti-China protests resulted in over 100 companies' properties being burned or raided. The majority of the firms were owned by Chinese or Taiwanese.
FPG, a major foreign investor in Vietnam, is a Taiwanese conglomerate of diverse interests, including biotechnology, petrochemical processing and production of electronics components.
Formosa Ha Tinh Steel is likely to regain its complete workforce of 24,000 within a month, according to media sources.
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