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The plastics enterprises complain about difficulties caused by strict control of scrap imports

The plastics enterprises complain about difficulties caused by strict control of scrap imports

Nearly 5,000 containers of scraps are backlogged

According to the Vietnam Plastics Association, currently there are nearly 5,000 backlogged scrap containers at Ho Chi Minh City port and Hai Phong port, causing difficulties for plastics enterprises due to lack of materials for production.

Tran Vu Le, Director of Le Tran Company – an exporter of recycled plastic products said that its plan on exporting about US$ 30 million of recycled plastic products in 2018 might not be successful due to the lack of materials for production. However, with the orders signed with customers, the enterprise still has to implement, so it must import new plastics instead of scrap plastics. Thus, the enterprise will suffer a loss of US$ 10 million in this year.

He added that the strict control of scrap imports makes it difficult to a series of other recycling enterprises when they have to pay hundreds of billion to invest in plants and technology lines to solve environmental problems related to the recycling of scrap plastics, but have no materials for production.

In regard to the imports of scrap plastics, Mr. Ho Duc Lam, Chairman of the Vietnam Plastics Association shared that China's policy to ban imports of scrap plastics to its country is opening a very good opportunity for Vietnam plastic recycling enterprises about the source of the materials. Accordingly, plastics enterprises are also growing up. Many enterprises paid hundreds of billion to invest in technology for recycling and treatment of waste and exhaust emission. The export turnover of recycled plastics of Vietnam also grew remarkably in the past two years from US$ 86.5 million in 2016 to US$ 95.7 million in 2017.

The reason why enterprises must import scrap plastics from abroad for recycling is that the scrap plastics from foreign countries are a source of clean and qualified materials because they are well sorted. Meanwhile, scrap plastics in Vietnam are limited, only accounting for 10% of total living waste and are not well sorted, so their quality is low and fails to meet the manufacturing requirements for export products to foreign countries.

Regarding the environmental pollution, enterprises also confirmed that if scrap plastics are properly processed, they will not harm the environment. In addition, there are many scrap plastics but actually they are clean and new products such as such as zumbo bags, plastic film (these products were imported a lot and were sold to other units in their right purpose for use). However, recently, they are listed as products banned from imports. Therefore, the determination of some products in scrap plastics as hazardous waste is not in accordance with regulations of both Vietnam and the world.

Why are there a lot of goods backlogged at ports?

Analysing the reason for backlogs of thousands of scrap containers at ports, which annoys the public and imposes pressure on state management agencies, the representative from the Vietnam Plastics Association noted that one of the reasons was the change in the management of import licensing by the Ministry of Natural Resources and Environment.

From September 2015, the licensing of scrap imports has been done by the Ministry of Natural Resources and Environment. However, in 2016-2017, very few enterprises applied for licenses because they could not compete with Chinese enterprises. From 2018, when China issued a ban on scrap imports, the recycling enterprises began investing in building plants to satisfy the licensing requirements of the Ministry of Natural Resources and Environment. However, it will take 1-2 years to perfect the plants, and meanwhile imported scraps have arrived at ports, but the technical infrastructure was not completed.

Another reason for the backlogs at ports is that the National Technical Standards QCVN-32 of the Ministry of Natural Resources and Environment are unable to be applied in reality because enterprises have no way to calculate the proportion of contaminant in the shipment, which should not exceed 2% as per regulations. According to this standard, only 4 types of raw materials are allowed for imports. Other types though, that bring great benefit in the recycling business, are not allowed. Therefore, goods are backlogged at ports because the goods owners could not receive goods for failing to meet the standards.

In addition, some recent regulations of the Customs on tightening the scrap imports also contributed to the backlogs of many scrap containers at ports due to failure of Customs clearance.

Moreover, due to the long-stay of goods, demurrage and storage fees are greater than the value of the shipment, so many enterprises refuse to receive goods, which is one of the reasons for backlogs of thousands of containers of scrap plastics at ports.

Facing these difficulties, the Vietnam Plastic Association proposed the Ministry of Natural Resources and Environment to mobilize human resource to speed up the import licensing for enterprises, which have made investments in technical infrastructures according to the standards, to facilitate them quickly into production. Considering and extending VNQV32 standards, putting recyclable plastics without hazardous contaminant into the list of goods which are permitted for imports in order to make use of the material resources and avoid backlogs at ports.

The Ministry of Transportation requested that the shipping lines should only receive goods from enterprises which were granted import licenses. Shipping companies are requested to exempt the demurrage and storage fees for enterprises to quickly release the backlogged goods.

Furthermore, the Vietnam Plastics Association has also recommended the Customs authorities to carry out the clearance of scrap plastics according to Decree 38/2015 / ND-CP and Circular 41/2015 / TT-BTNMT and clear containers of scrap plastics that have been backlogged at ports.

Source: Customs News

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