Formosa Plastics Group, Taiwan’s biggest diversified industrial company, said accelerating inflation in Vietnam won’t deter it from constructing a steel plant in the Southeast Asian nation next month.

Formosa is also studying to build an oil refinery and ethylene plant in the country, Chief Executive Officer William Wong told reporters in Taipei over the weekend.

He didn’t give details about the new projects being considered. Vietnam is trying to contain an inflation rate that’s the fastest since at least 1992. Consumer prices in Vietnam surged 25.2 percent from a year earlier in May.

“We’ll be careful, while investments in Vietnam will continue,” Wong said after a shareholders’ meeting for unit Nan Ya Plastics Corp. “We remain confident.”

Formosa Plastics in April said it will spend US$2.57 billion to set up a steel mill in Vietnam and take a 95 percent stake in the venture.

A new company may start building the mill with annual capacity of 7.5 million metric tons by the end of the year, K.

H. Wu, president of Formosa Heavy Industries Corp., said in an interview.

Taipei-based Formosa Plastics is seeking to build factories overseas as there isn’t much land for new plants in western Taiwan’s Mailiao, the group’s biggest production site, Wong said in January.

The Chinese-language newspaper Economic Daily News reported last month Formosa plans to build a petrochemical complex in Vietnam, in addition to a proposed steel project.

The complex will cover an area as large as 6,000 hectares, more than triple the size of the company’s petrochemical base in Taiwan. Formosa Plastics is expanding in Vietnam to cut costs and tap the Southeast Asian market.

Source: Thanhnien News