Responded by units: The Ministry of Construction; Ministry of Finance (General Department of Customs)

Official letter: No 17/BXD-VLXD; 609/TCHQ-PC, dated: 2018-01-03

Responded contents:

Ministry of Construction:

The Ministry of Construction received a document No. 13387 / VPCP-CN dated December 15, 2017 of the Government’s Office announcing the direction of Deputy Prime Ministry Trinh Dinh Dung on the export of sand; a Document No. 12513 / VPCP-DMDN dated November 23, 2017 of the Government’s Office on settlement of precommendation of Vietnam Import - Export and Investment Services Company; a Document No. 13736 / VPCP-CN dated December 26, 2017 of the Government’s Office on the export of silica sand and golden sand for casting; A transfer note of the Official letter No. 1576 / PC-VPCP dated December 20, 2017 of the Government on settlement of Beltech Corporation's recommendation.

In addition, in relation to the sand export’s policy of the Government of Vietnam, the Ministry of Construction also received a document No KEV-17-1003 dated October 17, 2017 of the Embassy of the Republic of Korea in Vietnam; a document No JF: 1318/2017 dated December 12, 2017 of the Embassy of Japan in Vietnam; a Document No. 598 dated December 14, 2017 of Taipei Economic and Cultural Office in Vietnam; a Document No. 3353 / PTM-VP dated December 14, 2017 of the Vietnam Chamber of Commerce and Industry and documents of business engaged in production and business in the field of exploitation, processing, use and export of the white silicon sand, including Document No. 01 / TTDN-CV dated November 15, 2017 and a Document No. 03 / TTDN-CV dated December 13, 2017 of the white sand business, a Document No. 51 / SIBICO-CV dated November 7, 2017 of Binh Thuan Sand Processing Limited Liability Company, a Document No. 117 / TTr-KSQT dated November 10, 2017 of Quang Tri Minerals Joint Stock Company, a Document No. 184 / VIC .17 dated November 13, 2017 of Vietnam Import Export and Investment Services Joint Stock Company (Vicosimex), a Document No. 128 / BIDICO-CV dated November 13, 2017 of the Investment and Development Joint Stock Company The Letter No. 140 / CV-KNKS dated November 13, 2017 of the Mineral Industry Corporation of Quang Nam Province, a Document No. 131 / VTCO-CV dated November 13, 2017 and Document No. 151 / VTCO-CV dated November 15, 2017 of the Vico Quang Tri Investment and Mineral Joint Stock Company, a Document No. 25 / CV-TMC dated November 15, 2017 of Transcend Vietnam Limited Liability Company, a Document No. 40/2017 / CV-HT dated November 21, 2017 of the Viet Nam - HoangTiep Limited Company, a Document No. NVC -MOF dated November 21, 2017 of Nakashima Vietnam Co., Ltd, Document No. 19 / TP dated November 25, 2017 of the Thuan Phat Limited Company.

Previously, it involved stopping exports of permanent sand of Cambodia and affect the construction market of Vietnam, as well as exports of sand in general (sand for the construction,  the saline sand, the silica sand) according to the Government’s Prime Minister's Decree No. 9826 / VPCP-CN dated September 15, 2017 of the Government’s Office, the Ministry of Construction has issued Document No. 2495 / BXD-VLXD dated October 23, Specifically:

For the construction Sand: Vietnam has not exported construction sand since 2009 under the Prime Minister's Instruction 29/2008 / CT-TTg dated 02 October 2008 and Circular 18/2009 / TT. -BXD dated 30 June 2009 of the Ministry of Construction guiding the export of minerals for construction materials. At present, after the direction of the Prime Minister on the strengthening of the management of the exploitation and consumption of sand and gravel construction, the demand for sand, especially in the provinces of the Cuu  Long River is suffering from supply shortage, the Ministry of Construction has seriously directed not exporting the construction sand.

 For the salinity sand: The export of saline sand recovered from dredging projects at estuaries and seaports over time is carried out in accordance with Announcement No. 407 / TB-VPCP dated December 17, /2012 of the Government’s Office. The implementation of the guidance in a Document No. 278 / TB-VPCP dated June 22, 2017 of the Government’s Office on a notice of conclusion of the Prime Minister Nguyen Xuan Phuc, the Ministry of Construction has seriously stopped the export guidelines of all saline sand that are recovered from dredging projects, clearing of channels in estuaries and seaports.

At present, there are not any units that export the salinity sand.

For the exploitation, processing and export of silica sand, the Ministry of Construction shall report to the Prime Minister as follows:

 The implementation of the planning on exploration, exploitation, processing and use of the white silica sand

White the silicon sand is a main construction material under the master plan for exploration, mining, processing and use of minerals for construction materials in Vietnam up to 2020 approved by the Prime Minister in the Decision No. 152/2008 / QD-TTg dated November 28. 2008 and the amendment and supplementation of Decision No. 45 / QD-TTg dated January 9, 2012.

White sand mineral resources in the country are forecast at 1.4 billion tonnes. However, most of the white sand mines are concentrated in the central coastal provinces of the Central and South Central Coast. Therefore, planning for exploration and exploitation are difficult due to the influence of tourism development planning. and localities.

By the end of 2016, except for exploitation licenses granted by local People's Committees in the form of small scattered or recovered minerals in the project of the construction investment areas, the Ministry of Natural Resources and Environment granted 15 licenses to exploit white silica sand with total approved volume of 137 million tons and exploiting capacity of 3.58 million tons per year. The annual production and processing output is over 1.1 million tons. Post-mining sand products, processing and screening are mainly used as raw materials for glass and glass manufacturing plants and construction glass; used as porcelain enamel, ceramic tiles, ... in the country and partly exported abroad.

According to statistics from the General Department of Customs and the reports of enterprises, related to sand export activities, there are many types of enterprises involved:

Some businesses have licensed mineral deposits, invested in processing establishments and directly involved in export of sand such as: The General Ha Tinh Minerals and Trading Company, Investment and Vico Quang Tri Minerals, Joint Stock Company; the Vietnam Import Export and Investment Services Joint Stock Company – the Vicosimex, Mineral Industry Minerals Company of Quang Nam - Minco, Joint Stock Company investment and development of Bao Thu industry, the Khanh Hoa Minerals and Investment Corporation.

Some enterprises have no license but have investment in processing and exporting such as: the Transcend Vietnam Limited Liability Company, the Viet Nam Hoang Tiep Limited Company.

 Some enterprises do not have a licensed mine, do not invest in processing factories, but have a market to participate in export trade activities such as: The NHV Investment Joint Stock Company, Vien Thien Industrial Supplies Supplying Joint Stock Company, The An Vien Co., Ltd, ...

Some mineral mining businesses have been licensed, invested in processing establishments but have not participated in exports, only domestically supplied such as the Viglacera Van Hai Joint Stock Company, the FiCO Cam Ranh Sand Co. Ltd .

In addition, some mining businesses have been approved for stocking or mining licenses but have not yet come into operation such as: The Viglacera Corporation (the Ba Don White Sand in Quang Trach District, Quang Binh Province); Yeou Lih Silica Sand Vietnam Co., Ltd (Tan An white sand mine in Tam Ky City, Quang Nam Province); the Viet Phuong Group Corporation (white sand mine in the Phong Hien Commune, the Pho Dien District, Thua Thien Hue Province); The Prime Minister Thien Phuc Joint Stock Company (sand mined in the Phong Chuong Commune, Phong Dien District, Thua Thien Hue Province), and a number of enterprises are licensed by the People's Committee for sand in the area of the investment project of construction works.

2. The situation of production, consumption and export of white silica sand

The total production and consumption of white sand in the country is now over 1.1 million tons / year, in which 70% is consumed in domestic market (as raw material for glass and glass production) is about  60%, additives and materials for producing paints, ceramics, artificial stone ... about 10%); exports account for about 30%.

2.1. Situation of domestic consumption

 To use as raw material for glass and glass production (for 07 existing glass factories with a capacity of 240 million m2 QTC glass per year): Total demand is about 650,000 tons per year.

To use for other sectors: Total market demand for quartz sand powder for paint, ceramics and other sectors is about 100,000 tons / year.

Quality requirements for glass and construction glass: The sand has to be segregated to ensure that the content of SO 2 is 98% and the Fe 2 content is less than 0.1%.

 Selling price of the white silica sand: At average price of over VND 300,000 / ton of product.

 In the period from 2018 to 2020, there will be 06 new glass projects being invested with a capacity of 217 million m2. QTC / year will be put into operation and by 2020 the total designed capacity will increase to 457 million m2 QTC / year (approximately 6,500 new glass per day), corresponding to the demand for white sand used as raw material for glass production is about 1.3 million tons / year. With the existing capacity of exploitation and processing, the demand for white raw materials in this area will be fully met from present to 2020.

 2.2 Export situation

 Pursuant to Clause 2, Article 2 of Decree No. 15/2012 / ND-CP dated March 19, 2012 of the Government detailing the implementation of a number of articles of the Law on Minerals, to coordinate with the Ministry of Natural Resources and Environment and concerned ministries and branches in elaborating and promulgating the list, conditions and criteria for export of minerals to be used as construction materials.

According to Circular No. 04/2012 / TT-BXD dated 20 September 2012 of the Ministry of Construction guiding the export of minerals for construction materials, silicon white sand and yellow sand for casting molds minerals are allowed to be exported when the processing conditions (with white sand requiring SiO2 content> 99%), with gold mold casting required SiO2 content> 95% and particle size <2%. , 5 mm). Unprocessed raw silica sand is not eligible for export.

According to general data from the General Department of Customs, reports of local and enterprises, the situation of export of silica sand is as follows:

Volume and value of exports: In 2015, the export volume of silica sand (including white sand, yellow sand) is 406,400 tons, export value is USD 11,337 million; 2016: export volume of silica sand is 422,800 tons, export price is USD 12,956 million). In the first nine months of 2017, the export volume of sicic sand was approximately 400,000 tons.the  Export proportion: Sandy materials used for glass and construction glass accounts for the largest share (about 55%); followed by fine quartz powder and super smooth (about 31%); finally, the molding sand with a small boulder (about 14%).

Types of export products: Include silica sand through sieves, as raw materials for glass and construction glass; cat or golden sand for molding; fine and fine quartz sand as raw materials for producing ceramic, porcelain, refractory bricks, abrasive powder and as raw materials for producing high-tech products such as super-white glass for making screens, liquid, fiberglass cotton, ...

 Export price (FOB price) by product categories as follows:

+ White silica (processed screening) as raw materials for glass and glass production: $ 27 - 33 per ton;

+ White silicon sand: (by processing sieve): 25-28 USD / ton;

+ White silicon (processed, screened, plastic coated): 120 -130 USD / ton;

+ Golden sand (through processing sieve) used for molding: $ 8- 13 / ton;

+ Fine and fine quartz sand powder (milled from silica sand): USD 80 -155 / ton.

Contract term: Average from 03 to 04 years

1 Importing countries: South Korea, Japan, Taiwan, China, Thailand, Singapore, Malaysia, Philippine ... In which, South Korea is the largest importer with annual volume accounting for over 50% of silicon white sand exported from Vietnam. Japan is second, followed by Taiwan, Philippine and other countries.

Export Tax (according to the Export and Import Tariff promulgated together with Decree No. 122/2016 / ND-CP dated September 1, 2016 of the Government): The common export tax rate is 30%; Some fine quartz and fine quartz sand products with a particle size o <96 Mm used as raw materials for producing high-grade products are subject to export tax of 5%.

 Impact of the policy on stopping sand exports

Over the past time, the Ministry of Construction has received documents of Vietnamese and foreign enterprises operating in the field of mining, processing and exporting sand; Notes of the Embassies of Korea, Japan in Vietnam; Text of the Taipei Economic and Cultural Office in Vietnam; A letter from the Vietnam Chamber of Commerce and Industry expressing its opinion on the policy of non-exporting sand of the Government of Vietnam. Specific details are as follows:

 Silicon white sand is used as raw materials for some industries such as glass, glass, mold, porcelain, etc. With the production characteristics of these sectors are continuous export, so have to have a stable and long-term source of raw materials. The immediate stop will directly affect the production of foreign enterprises using white sand from Vietnam. At the same time, Vietnamese enterprises, when unilaterally stopping export contracts will be prosecuted by the customers to the Economic Court and will be fined for violating the contract signed with their partners, causing great economic losses for businesses.

Enterprises using white sand imported from Vietnam as raw materials are big corporations in the world such as Korea, Samsung, LG (electronics), Doosan (glass, machinery, industry heavy vehicles, Hyundai, Kia (automobile production), Hanknk Glass - Saint Gobain (construction glass, solar glass); Japan has Nippon Sheet Glass; In Thailand, there are Union Glass, Ocean Glass (household glassware), ... These are units with investment and products that have been traded with Vietnam; Therefore, if there is no industrial raw material sand, the related manufacturing sectors will also be affected. At the same time, it will cause adverse impacts on the business and production environment of many foreign enterprises that having trade relations with Vietnam; Especially, it can influence Vietnam's cooperation with other countries in the region.

The products of sand exported are many times higher than the sand in the original state and higher than the price of sand in the domestic market.

 Many Vietnamese businesses have invested in processing and modernizing sand and gravel. While the current domestic market has not consumed all the available silica sand, the export of sand will contribute to ensure stable supply of one market in the country and solve difficulties for enterprises. .

 Stopping the export of sand also has a direct impact on the employment and livelihood of workers in enterprises due to stopping production and consumption. In addition, the removal of permits to continue exporting silica sand will contribute to increase revenue for the state and local budgets; At the same time, it creates favorable conditions for enterprises to create more revenues from export activities so that enterprises can develop their internal resources and reinvestment and promote the development of the industry of mining and processing.

Proposals of the Ministry of Construction

Based on the guidance of the Government’s Prime Minister and recommendations of businesses, in order to effectively manage and exploit mineral resources, to create conditions to remove difficulties and create a favorable, stable and long-term business investment environment, at the same time, increasing relations between Vietnamese enterprises and enterprises in the region. To provide opportunities for investment and development on the socio-economic. The Ministry of Construction shall report to the Prime Minister on the following solutions:

4,1 Immediate solution

a) For silicon white sand:

To allow enterprises to continue exporting with export contracts signed with import partners that are still valid from current until the date of issuance of the Circular amending and supplementing the Circular No. 04/2012 / TT-BXD dated September 20, 2012 of the Ministry of Construction guiding the export of minerals for construction materials. Exports must meet requirements of the origin of minerals (with the valid exploitation permit issued by the competent authority) and export products that meet the export standards Appendix 1 of the Circular 04/2012 / TT-BXD. Particularly, the products permitted for export include: the silicon white sand which has been processed as raw materials for glass and building glass; the processed silica sand (plastic or not coated) for molding; the fine quartz and super smooth sand; golden sand made into molds; standard sand for laboratory use.

To assign the Ministry of Construction to review and issue the Circular amending and supplementing the Circular No. 04/2012 / TT-BXD to stop the export of unprocessed raw white sand and pre-selected sand; to continue exporting products that have been processed deeply, fine grinding sand, sand for casting mold with high economic value; At the same time, the Ministry of Finance has assigned the Ministry of Construction to coordinate with the concerned agencies in inspecting and evaluating the investment’s situation, production and business activities of enterprises exploiting and processing silicon white sand to have solutions to export to the Prime Minister to promote production, contributing to socio-economic development, according to the content of the conclusion of the Deputy Prime Minister Trinh Dinh Dung in the Document No. 264 / TB-VPCP dated June 14, 2017 on the status of the mining industry in Vietnam.

b) For construction sand

To continue implementing the policy of not exporting construction sand.

To agree with the policy of allowing foreign construction sand to stabilize supply and demand in the country, limiting illegal exploitation of sand and gravel in the river.

c) For salinity sandy

To continue implementing the policy of non-export stoppage in the Notice No. 278 / TB-VPCP dated June 22 2017 of the Government’s Office

4.2 Long-term solution

The Ministry of Natural Resources and Environment is requested to take the lead and coordinate with the Ministry of Construction to accelerate the implementation of the "Project on the overall evaluation of the potential of Vietnam's coastal sandy resources" as a basis for pricing and planning master plan for white silica minerals in particular and minerals for construction materials in general nationwide.

To assign People's Committees of localities to direct and closely supervise the exploitation, processing and export of sand of enterprises in localities and report on the periodical export according to regulations. For localities having potential of coastal white sand resources, in the process of approving planning projects on urban centers, industrial parks and eco-tourism areas in the area, it is necessary to seriously conducting consultations with concerned agencies according to the provisions of the Law on Minerals and the Law on Urban Planning to avoid anti-encroachment between the relevant plannings; particularly, the recovery of white sand minerals in areas where exist investment projects on the construction of works to manage, protect, exploit and use mineral resources reasonably, economically and efficiently.

The Ministry of Finance

On the proposal of the Official Letter No. 7406 / TCHQ-GSQL dated November 10, 2017 of the General Customs of stopping export of white sand (page 4-7 in Appendix 1). Official Letter No. 3353 / PTM-VP).

The General Department of Customs in the Official Letter No. 7406 / TCHQ-GSQL dated November 10, 2017 requested the provincial / municipal Customs Departments to stop the customs procedures for export of minerals being white silica sand according to the opinion of the Ministry of Construction. At the same time the Ministry of Finance also issued an Official Letter No. 2521 / BXD-VLXD dated October 25, 2017. At the same time, the Ministry of Finance also issued an Official Letter No. 15509 / BTC-TCHQ dated November 15, 2017 to report to the Prime Minister. The Ministry of Finance and the General Department of Customs did not receive the direction of the Government’s Office. The policy of not exporting all kinds of sand to foreign countries. Since then, the Ministry of Finance has proposed to the Prime Minister to inform concerned agencies and units of stopping the export of all kinds of sand and assign the Ministry of Construction to amend the Circular No. 04/2012 / TT-BXD as appropriate.

We recommend the Vico Company to contact the Ministry of Construction to resolve according to its competence.