Loan for Wharf Development and Operation by Japanese Company in the Socialist Republic of Vietnam
Supporting the Overseas Expansion of Japanese Steel Industry
- Region: Asia
- Overseas Investment Loans
The Japan Bank for International Cooperation (JBIC; Governor: Akira Kondoh) signed a loan agreement amounting up to US$5 million (JBIC portion) with Thi Vai International Port Company Limited (TVP), a Vietnamese subsidiary of KYOEI STEEL LTD. (KYOEI STEEL).*1
This loan is cofinanced with Sumitomo Mitsui Banking Corporation and Resona Bank, Limited, bringing the total cofinancing amount to US$15 million.
This loan will provide the funds needed by TVP to develop and operate the wharf facilities in Cai Mep-Thi Vai Port in Vietnam's Ba Ria-Vung Tau Province. The fund will be applied to the capital investment required to develop these wharf facilities to provide logistics services mainly for Vina Kyoei Steel Limited (VKS), a Vietnamese subsidiary of KYOEI STEEL, and other steel related industries located in the surrounding area.
Holding the top share in Japan's steel bar market, KYOEI STEEL is a major electric-furnace steelmaker whose mainstay business is the manufacture and sale of steel products, particularly steel materials for civil engineering and construction. It has been actively expanding its business overseas as well, establishing VKS as a joint venture with a local company in Vietnam in 1994 and Kyoei Steel Vietnam Company Limited, a local subsidiary in Ninh Binh Province similarly engaged in the manufacture and sale of steel materials for construction in 2011. As growing demand in Vietnam for construction-use steel materials has created a capacity shortfall at the existing wharf facilities in Thi Vai Port, which is used by VKS, KYOEI STEEL intends to stabilize the operations of VKS through business with TVP, with a view to increasing its market share of steel products in Vietnam. This financing will also contribute to maintaining and strengthening the international competitiveness of Japanese companies by supporting KYOEI STEEL's overseas expansion.
As Japan's policy-based financial institution, JBIC will continue to provide financial support to assist Japanese companies in developing overseas businesses, in growing markets such as Vietnam, by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function.
- *1 This loan agreement was signed on November 2, 2017, but the press release is only being issued today.