Many FDI enterprises are concerned that electricity shortages will recur this year and asked Vietnam to have a plan to provide electricity throughout.
Sufficient electricity supply is a recommendation raised by many foreign investor associations at the conference where Prime Minister Pham Minh Chinh met with FDI enterprises, within the framework of the annual Vietnam Business Forum (VBF 2024), on the morning of March 19. .
The electricity shortage occurring in the North in the second half of May and early June 2023 has left many impacts on production and business of enterprises. Some industrial zones at that time cut power with prior notice, with a frequency of 1-2 times a week.
At today's conference, representatives of the Japan Business Association (JCCI) called the power outage incident in the North last year serious. "Many businesses cannot make production plans and forecast delivery dates. This causes the "just in time" model - the core of the supply chain - to be greatly impacted," a JCCI representative said, adding that Some member units are considering reviewing their global production systems.
Mr. Hong Sun, Chairman of the Korean Business Association (Kocham) in Vietnam also said that electricity for production is a condition for FDI enterprises, including Korean companies, to maintain stable operations. He proposed that the Government have a plan to ensure electricity supply for industrial parks during this year's hot season. At the same time, the Ministry of Industry and Trade needs to have a mechanism to encourage companies to save and develop energy production.
According to calculations by the World Bank (WB), last year Vietnam lost about 1.4 billion USD due to electricity shortage, equivalent to 0.3% of GDP. Representatives of associations said that electricity shortages will affect new investment decisions in Vietnam. "Insufficient electricity is currently a big factor that makes many Korean businesses, especially high-tech companies, hesitate to invest capital," Mr. Hong Sun said.
Mr. Joseph Uddo, Chairman of the American Chamber of Commerce (Amcham) in Hanoi, warned that many of Vietnam's goals will be difficult to achieve without a stable and affordable power source.
Responding to the concerns of FDI enterprises, Deputy Minister of Industry and Trade Nguyen Sinh Nhat Tan said that the agency is making efforts to provide enough electricity. "We pledge that there will be no electricity shortage this year and in the following years," Mr. Tan said.
According to him, to avoid electricity shortage, Vietnam is focusing on developing sources, urgently completing the 500 kV circuit 3 line to bring electricity to the North and synchronize the transmission system.
Commenting further, Amcham representative said that cooperation between the public and private sectors is necessary to develop sustainable, affordable power sources. Vietnam can attract global financial resources thanks to its effective energy management system.
JCCI's side suggested that authorities should prioritize policies to realize large-scale renewable energy projects, especially offshore wind power and rooftop solar power.
