Vietnam says recovery from Formosa industrial disaster could take a decade

My Pham and Mai Nguyen Reuters 24 Dec 16;

HANOI - Vietnam's central region is expected to take a decade to completely recover from an industrial accident caused by a unit of a Taiwan conglomerate, which led to Vietnam's worst ever environmental disaster, the government said.

Formosa Ha Tinh Steel, a unit of Taiwan's Formosa Plastics that runs an $11 billion steel plant, sullied more than 200 km (125 miles) of coastline in April, killing more than 100 tonnes of fish and devastating the environment, jobs and economies of four provinces.

Responding this week to questions as part of a Reuters investigation in November, Vietnam's environment ministry said the firm had rectified 50 of 53 violations and was on its way to removing the biggest cause of the disaster, a highly toxic "wet" coking system that Formosa had used in a deliberate violation of its agreement.

After months of mystery over the cause of the deaths of the fish, and public outrage against both the Hanoi government and one of the communist state's largest investors, Formosa agreed in June to pay $500 million in compensation.

The accident emboldened the Vietnamese public over the course of several months, with coordinated rallies in major cities and an outpouring of social media anger in a display of dissent on a scale not seen during the Communist Party's 41 years of tight control of the country.

Thousands of people from the affected region accuse the government of mishandling the disaster and the payment of compensation. Police were criticized for heavy-handed measures to break up street demonstrations.

The government always said it was doing everything it could to investigate the disaster and address the problem.

The ministry said Formosa had disregarded a series of commitments it had made to the government in securing approval to build the plant, which once fully completed would be the largest steel facility in Southeast Asia.

ILLEGAL CHANGES

"Formosa had deliberately changed many of the contents of the two environmental impacts assessment reports approved in 2008 including using 'wet' coking system instead of 'dry'," the ministry said a detailed response.

"These changes are illegal."

Formosa did not immediately respond to Reuters' request for comment on the environment ministry's assessment.

Wet coking uses water for cooling and is considered more polluting, as it generates more emissions and waste water that contains compounds that include cyanide. The dry process is cleaner and widely used in modern plants, but is more costly.

The ministry said it had asked Formosa Ha Tinh to start work on introducing the dry system from the end of next month and it must complete the job by June 30, 2019, at the latest.

The environment in the area has seen some improvement and was expected to be fully restored within 10 years if sufficient rehabilitation work was carried out, it said. Toxicity levels in the sea were under control.

The ministry said it was relatively satisfied with the firm's steps to fix the problems, but more needed to be done.

Formosa Ha Tinh Steel (FHS) executive vice president Chang Fu-ning said earlier that the plant was scheduled to begin full commercial production in the first quarter of 2017, subject to approval.

Formosa has planned to expand the steel plant to include a deepwater port and 1,500-megawatt thermal power complex.

(Reporting by My Pham and Mai Nguyen; Editing by Martin Petty, Robert Birsel)