Singapore demand and phony contracts sustain booming Mekong sand exports

vietnamnet 24 Aug 09;

VietNamNet Bridge – The volume of sand exported to Singapore from Vietnam’s Mekong Delta in the first half of 2009 was equivalent to the total exports of the last ten years. Ironically, most of it is shipped under falsely backdated contracts.

The many channels of the Mekong river are filled with sand dredging barges. Though the area has long supplied building sand to the Ho Chi Minh City region, its sand export business has not been considerable until now.

The Customs Office of Can Tho City reported that the volume of sand exported in the January-June period of 2009 rose dramatically to nearly 7 million tones, as much as was exported during the previous ten years.

The surge in exports was stimulated by Cambodia’s decision to ban further exports of its own river sand in order to reserve it for domestic use and limit further erosion of river banks.

Prior to May, while Cambodia still allowed sand exports, sand from Vietnam’s Mekong Delta was not favoured because it is of lower quality than Cambodian river sand.

Now, with the demand for sand by Singapore and some other countries in the region still on the rise, Vietnamese companies have lept at the opportunity to export this natural resource to Singapore, reports Tuoi Tre newspaper.

Nguyen The Hung, manager of a sand exploitation enterprise in Can Tho city, said that before Cambodia closed down sand exports, the prices for sand in the Mekong Delta were quite stable, from 15,000 to 17,000 per a cubic meter. Now, the prices are 25,000 to 30,000 per a cubic meter.

Cambodia exported its high grade sand to Singapore at the price of 90,000 dong per cubic meter. Currently, Vietnamese firms ship sand to Singapore for 40,000 dong per cubic meter. However, the profit from sand is still big because exporters can purchase sand at only 15,000-17,000 dong per cubic meter.

Vu Duc Hung of the River Police Bureau in Can Tho City said that since Cambodia banned sand exports, hundreds of sand barges travel on local rivers while sand ships of 10,000 tons or more anchor at Tra Noc and Cai Cui every day to take aboard sand from the barges. Each day around ten ships leave Vietnam, each carrying hundreds of thousands of cubic meters of sand.

Ironically, the booming sand export business is in patent violation of the intent of Vietnamese law. Prime Ministerial Instruction No. 29, issued in October 2008, established a temporary ban on Vietnam’s own exports of sand and gravel exploited from rivers and seas.

There was a huge loophole, however, exports could continue indefinitely under contracts signed before November 30, 2008. Based on this clause, sand is still exported to Singapore.

The deputy head of the Can Tho Customs Office, Nguyen Minh Thong, said that the the total volume of sand for export committed in contracts signed before November 30 2008 reaches tens of millions of cubic meters.

“Lured by virtually unlimited profits,” Thong said, “sand exporters change the date of signing contracts to before November 30 2008 to continue exporting sand.” The customs official added that hisoffice is not responsible for controlling these contracts.”

Thong said that because sand is a limited natural resource, the government should study the matter and establish a sand exploitation plan. He said the Can Tho authorities have proposed the Prime Minister to reconsider the instruction on sand export.

VietNamNet/Tuoi Tre