Quang Tri creates favorable conditions for coal trading from Laos

Director of Quang Tri Department of Industry and Trade Nguyen Truong Khoa told Quang Tri Newspaper about the prospects of coal trading between the two sides.

Could you please provide insights into the role of energy in driving the socio-economic development of both the country in general and Quang Tri in particular, especially in realizing the commitment to "Building Quang Tri into the energy hub of the Central region by 2030"?

The 13th National Party Congress has set the goal for Vietnam to become a developed, high-income country by 2045. To achieve this goal, the development of corresponding energy is of strategic importance, as energy is a crucial foundation for socio-economic development.

This is concretely outlined in Resolution No. 55-NQ/TW of 2020 by the Politburo on the orientation of the National Energy Development Strategy to 2030, with a vision towards 2045. The resolution of the 17th Provincial Party Congress continues to prioritize the energy industry as one of the breakthrough development sectors, with the determination to "Build Quang Tri into the energy hub of the Central region by 2030."

On July 26, 2023, the Prime Minister issued Decision No. 893/QD-TTg approving the National Energy Master Plan for the period 2021-2030, with a vision to 2050. Accordingly, the Government has directed that energy plays a crucial and essential role in socio-economic development. Energy development must be proactive, long-term, and effective to ensure national energy security, promote national development, build an independent and self-reliant economy, and improve people’s lives. Especially, the Government has set goals for planning each energy sub-sector, including the oil and gas sector, the coal sector, the new and renewable energy sector, and the electricity sector. In this regard, the coal sector is identified: during the period 2021-2030, it is expected to increase imports gradually and reach about 73 million tons by 2030.

In the period 2031-2050, it is expected to continue to increase and reach a peak of about 85 million tons in 2035, then gradually decrease to about 50 million tons by 2045, with the imported coal demand for thermal power plants planned to use imported coal in 2035 being about 64 million tons and gradually decreasing to about 34 million tons by 2045.

According to the report of the Department of Oil and Coal of the Ministry of Industry and Trade, it is estimated that in 2023, the output of commercial coal will be about 57.88 million tons, of which domestically produced coal will be about 44.68 million tons, and imported coal will be about 13.2 million tons. Calculations also show that the total coal consumption in 2023 will be about 56.95 million tons.

Of this, coal supplied for electricity production will be about 46.16 million tons; supplied for fertilizer and chemical production will be about 2.5 million tons; supplied for cement production will be about 1.74 million tons; supplied for other activities will be about 4.52 million tons, and exported will be about 2.03 million tons.

In the current context, Vietnam’s economy is facing many difficulties stemming from geopolitical conflicts worldwide, and energy crises leading to high input fuel prices for manufacturing sectors.

During a working session with key units in the coal industry, the Minister of Industry and Trade directly instructed related units to urgently conduct research on Laos“mechanisms and policies related to coal trading activities and survey Laos” coal market, transportation routes for coal to Vietnam, develop plans for establishing coal storage port systems at suitable locations, especially in border areas adjacent to Laos, to efficiently receive imported coal from Laos, conduct a review of port storage systems in the Central region to propose construction plans, intermediate coal storage facilities to ensure sufficient and stable supply of coal for domestic and export needs.

The National Road No.15D, stretching from the La Lay International Border Gate through Salavan, plays a pivotal role in creating favorable conditions for facilitating coal trading with Laos. Photo: D.T

Please provide insights into the crucial steps to boost cooperation between Vietnam and Laos in the coal trade sector, particularly aiming for the target of exporting 20 million tons of coal from Laos to Vietnam annually, depending on the market conditions and the needs of each party; promoting investment cooperation in coal mining, processing, and exporting activities; and enhancing the sharing of experiences to enhance capacity in coal mining and processing.

On July 20, 2023, a memorandum of understanding on cooperation in the coal sector between Vietnam and Laos was signed by the Vietnamese Minister of Industry and Trade and the Lao Minister of Energy and Mines.

The memorandum contains various important provisions aimed at promoting cooperation between the two countries in the coal trade sector, particularly the goal of exporting 20 million tons of coal from Laos to Vietnam annually, depending on market conditions and the needs of each party. It also seeks to promote investment cooperation in coal mining, processing, and exporting activities, as well as enhance the sharing of experiences to improve capacity in coal mining and processing.

The signing of the memorandum not only reaffirms the determination of the Vietnamese Ministry of Industry and Trade and the Lao Ministry of Energy and Mines to implement the directives of high-level leaders and contribute to enhancing the cooperation framework between Vietnam and Laos but also strengthens the solidarity and special friendship between the parties' respective governments and peoples. Additionally, it contributes to ensuring national energy security, promoting Vietnam’s energy transition commitments internationally, and creating favorable conditions for Laos to effectively exploit its potential and advantages to boost socio-economic development and national defense and security.

Quang Tri shares a border with Laos’s provinces of Salavan, and Savannakhet, and is close to Sekong Province, which are regions with significant coal mining and reserves in Laos. The proximity of these coal mines to the Cua Viet and My Thuy seaports in Quang Tri is assessed to be the closest and most convenient.

From here, coal can be transported by sea to power plants in the south, and north, or exported to global markets through the Pacific Ocean gateway, thereby positively contributing to meeting Laos’s coal export demands and Vietnam’s coal import needs.

This serves as a prerequisite for Quang Tri and its neighboring Laotian provinces to jointly research, coordinate, and advise the leadership of both countries on specific mechanisms and policies, creating favorable conditions for enterprises to invest, mine, process, and trade coal, thereby positively contributing to the development efforts of both nations.

How has the Department of Industry and Trade of Quang Tri Province played a role in researching and proposing solutions to create favorable conditions for enterprises and investors to implement production and business activities related to the energy sector, including coal import and export business with Laos?

To contribute to the national energy security efforts, in addition to advising the provincial leadership on the overall development of the energy sector, the Department of Industry and Trade of Quang Tri Province has actively researched and proactively proposed solutions to create favorable conditions for enterprises and investors to implement production and business activities related to the energy sector, including coal import and export business with Laos.

From 2021 to 2023, the amount of coal imported through the La Lay International Border Gate reached approximately 2.7 million tons, valued at over US$220 million. It is projected that in the future, Laos’s coal exports through the La Lay International Border Gate will increase to 20-30 million tons per year.

In line with the provincial leadership’s directives, the Department of Industry and Trade has prepared content, organized receptions, and worked with the Working Delegation of the Ministry of Industry and Trade to conduct comprehensive surveys on relevant matters. The aim is to propose recommendations to the governments of both countries to develop mechanisms and policies that create the most favorable conditions for production, business, and coal import-export activities of enterprises from Laos to Vietnam.

Recommendations include building and supplementing logistics planning, planning warehouse systems with sufficient scale and capacity to serve coal trading enterprises. Additionally, the Department of Industry and Trade has actively coordinated with relevant local departments and agencies to focus on planning and implementing investment in transportation infrastructure, border infrastructure, seaports, inland ports, specialized ports, warehouses, and terminals. This aims to enhance the connectivity of goods transportation, particularly coal from Laos to the Cua Viet and My Thuy seaports.

To capitalize on the advantages of the East-West Economic Corridor, Quang Tri Province has prioritized creating favorable conditions for investment and commercial activities, including import and export trade, for businesses. How does the province attract enterprises to research, propose, and invest in energy projects within its territory, particularly in coal import and export activities with Laos?

To leverage the role and position as a crucial trading gateway along the East-West Economic Corridor, Quang Tri Province has devoted all available resources to invest in developing infrastructure, particularly transportation infrastructure, to facilitate investment and commercial trade, including import and export activities for businesses.

The province has also directed the implementation of various strategies to attract enterprises to research, propose, and invest in energy projects within its jurisdiction, especially in coal import and export activities with Laos. It actively supports and collaborates with investors to overcome challenges and obstacles during project implementation, ensuring increasingly efficient investment, production, and business operations.

The Provincial People’s Committee is currently overseeing the implementation of Resolution No. 04/NQ-CP dated January 5, 2024, issued by the Government regarding the investment in constructing conveyors as part of the project to build a coal conveyor system from Laos to Vietnam across the international border in the La Lay Border Gate area. It is coordinating timely and effectively with Sekong Province to implement the agreed-upon minutes between the high-level delegations of Quang Tri and Sekong provinces, aiming to expedite the necessary approvals from the Laotian side for the two provinces to proceed with the next steps of the coal conveyor project and related transportation issues from Sekong to Quang Tri.

The provincial authorities have also continued to organize conferences to review and evaluate the outcomes of implementing the memoranda of understanding signed at high-level meetings between Quang Tri Province and its Lao counterparts, aiming to foster close collaboration among localities in supporting businesses on both sides to develop coal import and export trade with Laos.

To further support businesses in their investment, production, and trade activities related to coal import and export from Laos to Vietnam, the province needs to enhance guidance for relevant agencies to identify legal bases, responsibilities, and authorities at all levels and in all sectors to propose and study specific mechanisms and policies for submission to the government for consideration and implementation. These measures aim to serve the sustainable development goals of both countries.

Moreover, it is recommended that the central authorities consider and include in the Detailed Plan for Seaports, Ports, Port Bridges, Floating Docks, and Water Areas for the period 2021-2030, with a vision towards 2050, the establishment of specialized ports to receive cargo ships for coal import and export projects from Laos, in line with the comprehensive energy development plan of the province. Allocating medium and long-term investment sources to upgrade, renovate, and build new transportation infrastructure, ports, border gates, etc., will serve the socio-economic development of the province in general and support coal import and export activities in particular.

Enterprises planning to invest in and develop coal import and export business with Laos need to study technical conditions to invest in new technologies and adopt multimodal transportation methods, including roads (specialized containers), conveyors, waterways, and railways. It is essential to analyze and compare the advantages of transportation options, the benefits for enterprises and localities in the overall national interest, and develop plans to mitigate environmental impacts when proposing projects within the province. Furthermore, further research is required on activities to create regional linkages and connect key projects in the province to enhance investment efficiency.

Dao Thanh Tam - Ngoc Mai