Decision No. 343/2005/QD-TTg Approving the Planning for the Development of the Chemical Industry in Vietnam until 2010 (with consideration to 2020)

Pursuant to …;

Approves the Planning for the Development of the Chemical Industry in Vietnam until 2010 (with consideration up to 2020)by 2010 (taking into account 2020)

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PRIME MINISTER

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Considering the proposals of the Ministry of Industry in the letters No. 3034/CV-CLH dated June 10, 2005, No. 552/CV-CLH dated October 13, 2005, and the opinions of relevant ministries and agencies,

DECISION:

Article 1. Approves the Planning for the Development of the Chemical Industry in Vietnam until 2010 (with consideration up to 2020), with the main contents as follows:

1. Development objectives until 2010:

a) Building a chemical industry with a relatively complete structure, including major fields such as fertilizers, technical and consumer rubber products, basic chemicals (including organic and inorganic), petrochemicals, high-purity chemicals, pharmaceutical chemicals, and consumer chemicals to meet domestic needs, regional economic integration, and global requirements.

b) Gradually building a modern chemical industry, initially forming concentrated industrial zones and large-scale chemical production complexes using advanced technology, producing competitive products on the regional market.

c) Striving to achieve a development rate of 16-17% per year. The proportion of the chemical industry in the national industrial structure should reach 10-11% in 2010 and 13-14% in 2020.

Specific targets:

Fertilizer products: Deepening investment, technological innovation, and equipment upgrades for phosphate fertilizer plants, NPK fertilizer plants, bio-organic fertilizer plants, developing diverse blended fertilizers, increasing nutrient content, serving domestic usage and export. Concentrating capital investment in urea plants utilizing natural gas and coal, some advanced NPK plants, and DAP plants. Ensuring the supply of 6-7 million tons of various fertilizers annually for agricultural production.

Plant protection chemical products: Applying advanced processing technologies to produce environmentally friendly products, striving to meet 100% of domestic demand for plant protection chemicals by 2010.

Petrochemical products: In line with the approved strategy for the development of the Oil and Gas Industry, ensuring raw materials for the production of polyethylene (PE), polypropylene (PP), polystyrene (PS), polyvinyl chloride (PVC), meeting 50% of the country's plastic material needs. Providing raw materials for the production of nylon (PA), polyester (PES), textile dyes, and other chemicals, while also supplying raw materials for the production of coke, adhesives, surfactants, certain basic organic chemicals, synthetic rubber products, solvents for paints, etc.

Basic inorganic chemical products: Ensuring sufficient supplies of sulfuric acid and phosphoric acid for phosphate fertilizer and DAP production, and other industries. Investing in facilities for caustic soda and soda ash production to serve PVC, synthetic detergent, and other product manufacturing, such as paper and aluminum. Producing nitric acid for explosives used in mining and national defense. Manufacturing various oxides for ceramic, pigment, and other industries.

Electrochemical products: Deepening investment in existing production facilities, expanding production capacity to meet domestic consumption and industrial needs, adopting new technologies to produce high-tech products, especially power sources for electronic devices and telephones. Developing anti-corrosion technologies, electrochemical protective technologies, and coating materials for corrosion resistance.

Industrial gases: Ensuring adequate supply of common industrial gases for domestic production needs. Adopting advanced technologies to invest in facilities for rare gas production to meet domestic demands and reduce import ratios.

Rubber products: Upgrading technology and equipment at existing rubber production facilities nationwide. Focusing on upgrading equipment and technology to produce radial tires. Investing in the production of new technical rubber products such as industrial conveyor belts, medical rubber tubes, seals, gaskets, V-belts, and other items.

Cleaning agents: Meeting the entire domestic demand for laundry detergents, soaps, cleaning liquids, etc. Diversifying product types to suit consumer and market requirements. Products produced must meet international standards and have strong competitiveness.

Paint products: Ensuring the supply of high-quality common paints for domestic needs. Adopting new technologies to produce high-quality and specialty paints. Developing clean technologies in the paint industry: water-based paints, high-solid-content paints, etc.

Pharmaceutical chemical products: Investing in initial infrastructure and technology for pharmaceutical chemical industrial facilities. Ensuring the supply of most inorganic pharmaceutical chemicals and excipients. Initially, constructing several facilities for the production of organic pharmaceutical chemicals to serve the production and formulation of essential medicines. After 2010, applying and developing high-tech and biotechnology for pharmaceutical chemical production.

2. Development planning for products

a) Fertilizer products:

- Until the end of 2010: Investing in a coal-based urea plant with a capacity of 560,000 tons/year. Accelerating the construction progress of a urea plant utilizing natural gas in Ca Mau with a capacity of 800,000 tons/year. Investing in a DAP plant in Dinh Vu, Hai Phong. Constructing a NPK plant with a capacity of 300,000 tons/year using combined technology. Producing enriched superphosphate with a P content of 28-32%. Investing in two ammonium sulfate plants with a total capacity of 200,000 tons/year.₂O₅ - From 2011 to 2020: Studying the possibility of investing in a second DAP plant.

- Period 2011 - 2020: study the possibility of investing in a second plant to produce DAP.

b) Plant protection chemical products:

- Until the end of 2010: Investing in technology and equipment to innovate processing and production technologies, ensuring safety and environmental cleanliness. The total capacity of new processing units will be approximately 10,000-15,000 tons/year. Investing in two active ingredient plants with a capacity of about 3,000 tons/year and one surfactant plant with a capacity of 7,000-10,000 tons/year.

- Period from 2011 to 2020: select some appropriate technologies in the field of biotechnology for large-scale production deployment.

c) Petrochemical products: in accordance with the approved Vietnam Oil and Gas Industry Development Strategy:

- By the end of 2010, establish three petrochemical complexes, including:

+ The Dung Quat refinery-petrochemical complex: the Dung Quat oil refinery, the polypropylene (PP) plant, and the linear alkyl benzene (LAB) plant (raw material for laundry detergent).

+ The gas utilization complex at Phu My.

+ The Southwestern gas utilization complex.

Construct the second oil refinery and plants producing PP and PTA to supply polyester fiber production. Increase the capacity of the dibutyl phthalate (DOP) plasticizer plant from 30,000 tons/year to 75,000 tons/year.

- Period from 2011 to 2020: invest in expanding LAB surfactant production. Study the formation of a liquid cracker with a capacity of 600,000 tons/year, from which various types of plastics such as PE, PP, PVC, PTA, and PET can be produced.

d) Basic chemical products:

Develop large clusters of factories linked to the planning of raw material regions or major consumer areas. Invest in projects to produce caustic soda for PVC, aluminum oxide, paper, etc. Increase the production of small-volume chemicals, high-purity chemicals, including improving the quality of existing products and diversifying product lines. Develop the exploitation of resources such as limestone, phosphate ore, bauxite ore, imenite ore, seawater, potassium salt, etc., for basic chemical production. Import technology to produce complex basic chemicals.

đ) Electrical chemical products:

- By the end of 2010: improve product quality to meet international standards. Increase battery production capacity to 1.5 to 1.9 million kWh/year. Increase traditional battery production to 500 to 800 million units/year. Research the production of certain high-end specialized batteries.

- Period from 2011 to 2020: research to develop and improve the quality of new power sources to meet market demands for clean energy, such as lithium-ion batteries, electric vehicle batteries, and hybrid vehicle batteries.

e) Industrial gas products:

- By the end of 2010: create conditions for economic components to jointly invest in developing industrial gas products, especially oxygen and nitrogen due to their diverse quality grades. Attract foreign investment to produce rare gases requiring advanced technology and significant capital.

Invest in expanding the production capacity of some existing plants while building a liquid nitrogen plant accompanying the Ca Mau power-nitrogen project, a liquid oxygen-nitrogen plant accompanying the Phu My power-nitrogen project, and an industrial gas plant in the northern region.

- Period from 2011 to 2020: invest in a production line for rare gases to enable exports.

g) Rubber products:

- By the end of 2010: focus on modernizing equipment and technology for automobile tire manufacturing plants using radial technology. Expand production capacity to have the ability to produce 2.3 million car tires/year. Invest in building several plants producing raw materials such as rubber cord, steel fabric, and carbon black. Build a technical rubber products plant: conveyor belts, V-belts, and a car tire manufacturing plant with a capacity of 2 to 3 million sets/year, and a natural latex rubber products plant producing items like rubber gloves, medical and industrial rubber hoses.

- Period from 2011 to 2020: strongly develop the production of radial technology-based car tires on a large scale and other products such as conveyor belts and V-belts according to modern technology, ensuring high quality, serving export purposes.

h) Cleaning agents:

- By the end of 2010: meet all domestic market needs for laundry powder, soap, perfumed soap, and cleaning solutions. Invest in a 30,000-ton/year LAB plant supplying LAS producers. Study investing in one or two high-end cosmetic chemical plants.

- Period from 2011 to 2020: based on the development of the petrochemical industry, research the production of other types of surfactants.

i) Paint products:

- By the end of 2010: mainly expand production, while also investing in new industrial and specialty paints such as electrical insulation paint, ship paint, traffic paint, etc. Select products following trends: reducing lead toxicity, gradually moving towards powder coatings, developing electrophoretic paint, and emulsion paint. Focus on investing in 1 to 2 facilities to produce alkyd resin, acrylic resin, epoxy resin, and other resins for the paint industry.

- Period from 2011 to 2020: invest in several facilities specializing in producing high-quality paints for domestic consumption and export.

k) Pharmaceutical chemical products:

- By the end of 2010: invest in modern technology, update equipment and management to gradually meet the raw material requirements for drug production. Establish antibiotic and pharmaceutical chemical production facilities. From now until 2010, invest in inorganic pharmaceutical chemical and common excipient plants, herbal extraction and semi-synthetic plants, joint venture pharmaceutical chemical plants, high-grade excipient joint ventures, and antibiotic production plants.

- Period from 2011 to 2020: focus on the following directions: antibiotics and antibacterials, vitamins, antipyretics and analgesics, cardiovascular drugs, diabetes medications, epidemic prevention drugs. Based on the development of the chemical and petrochemical industries, strengthen intermediate chemical production facilities for the pharmaceutical industry, while also serving veterinary drug and growth regulator production.

3. Main investment projects of the chemical industry

The main investment projects are listed in the appendix attached to this decision.

4. System of implementation measures and policies for the planning

To ensure concentrated and effective investment, based on the product structure and competitiveness of the products, chemical products are divided into three groups as follows:

- Group of products that the State needs to directly invest in (Group I), including: production of nitrogen fertilizers, phosphate fertilizers (including DAP), production of plant protection products, production of petrochemical products, large-scale production of basic chemicals, extraction of raw materials for fertilizer production.

- Group of products that require State investment incentives (Group II), including: production of medicinal herbs, production of rubber products, extraction and processing of other types of raw materials, production of certain types of basic chemicals serving industrial production.

- Other groups of products (Group III), including: production of NPK fertilizers, organic microbial fertilizers, production of electrochemical products, production of industrial gas products, production of cleaning agents, production of paints, production of other chemical products.

a) Financial and credit solutions: The general financial and credit solution is to encourage and create all conditions for economic sectors to invest in developing the chemical industry according to their capabilities. Specific and stable incentives are provided to create an attractive environment for investors, particularly foreign investors. State capital is concentrated on key projects.

b) Market solutions: Improve mechanisms and policies to prevent the importation of low-quality, unsafe, polluting, or harmful chemical products. Strengthen efforts against counterfeit, fake, and smuggled goods. Through Vietnam's representative offices abroad and government delegations, assist enterprises in seeking export markets and trading partners.

c) Solutions to attract foreign investment: Create an attractive environment for investors, focusing on export-oriented and high-tech fields. Provide many opportunities and stable incentives to attract capital into industries classified under Group II.

d) Science and technology solutions: Implement key science and technology programs and projects on fertilizers, efficient exploitation and utilization of apatite ores, rubber products, petrochemical products, electrochemical technology, and plant protection chemical technology. Establish a science and technology market, organize research and development work well with a three-tier network: fundamental research at universities and basic research institutes, technological research and development at holding companies, and application and improvement of transferred technologies at enterprises.

In implementing science and technology projects and programs, particular attention should be paid to environmental solutions to ensure sustainable development.

đ) Management organization solutions: Enhance the role of State management by relevant Ministries and sectors over sensitive products such as fertilizers, plant protection chemicals, and pharmaceutical chemicals. Reorganize and reform the operations of state-owned enterprises in Group III and some enterprises in Group II.

Article 2. Implementation:

- The Ministry of Industry shall take the lead, coordinate with relevant Ministries, sectors, and localities to implement the planning for the development of Vietnam's chemical industry until 2010 (with consideration up to 2020).

- The Ministry of Finance shall take the lead, coordinate with the Ministry of Industry to develop special financial policies for products in Group I and basic chemical and rubber projects in Group II that fall under Category A investment projects.

- The Ministry of Health shall take the lead, coordinate with the Ministry of Industry to direct the Vietnam Pharmaceutical Corporation and the Vietnam Chemical Corporation to develop plans for the development of the pharmaceutical chemical industry.

- The Ministry of Transport shall coordinate with the Ministry of Industry to develop comprehensive transportation development plans to serve the chemical industry, including transportation of raw materials, products, and equipment for factories during construction.

- Relevant Ministries: Planning and Investment, Agriculture and Rural Development, Construction, Trade, Science and Technology, Natural Resources and Environment, Transport, Health, Finance, Defense, Public Security, State Bank of Vietnam, Development Fund... shall cooperate according to their assigned functions to handle matters proposed by the leading agency.

- The Vietnam Chemical Corporation shall be responsible for developing detailed plans for the development of product groups such as fertilizers, plant protection chemicals, rubber, electrochemical products, industrial gases, cleaning agents, and paints.

- The Vietnam Oil and Gas Corporation shall be responsible for developing detailed plans for the production of nitrogen fertilizers from gas, and coordinate with the Vietnam Chemical Corporation and related agencies to develop petrochemical products.

- Provincial People's Committees and municipal people's committees under central jurisdiction shall concretize the planning for industrial development in their respective provinces and cities to suit local conditions.

Article 3. The Standard Measurement Quality Control Department shall be responsible for organizing and guiding the implementation of the Regulations adopted herein.

Article 4. Ministers, heads of ministerial-level agencies, heads of central government agencies, provincial People's Committees, municipal People's Committees under central jurisdiction, and related agencies are responsible for implementing this Decision./.