Malaysian PM derides West on Islam, Mideast

Global Steelworks International Inc., the country’s largest steel manufacturer, will invest $1.5 billion for a new integrated steel plant in the country.

“We will produce steel from indigenous sources,” Lalit Kumar Sehgal said during yesterday’s press conference.

According to Sehgal, they are still awaiting government approval. The new plant, he said, will be operational three years after obtaining the government’s nod. Sehgal said they are  considering several locations for the plant but is yet to make a final decision.

Should the planned steel plant push through, Sehgal said it will be able to produce $6 billion worth of steel, $1 billion of which will be sold locally while the rest is for exports.

When asked for a time table for the investment, Sehgal said he cannot give one because the government has yet to issue them mining rights. Global Steel is looking at obtaining limestone, dolomite and coal.

Also, Sehgal said the government must give the company infrastructure support before they can commit to investing in the country.

Sehgal refused to say where they will get the money for the new plant saying only that it can be sourced through bank financing or a joint venture.

Global Steel has a multi-billion loan to several local banks including the Philippine National Bank (PNB), Metropolitan Bank and Trust Co. (Metrobank), Land Bank of the Philippines, China Banking Corp. and Rizal Commercial Banking Corp. (RCBC).

In the same conference, Global Steel again dispelled stories that they are selling their Iligan Plant to another Indian firm the Tata Group. Sehgal said that if they are indeed for sale, then they would not consider infusing more money to the country.

However, industry sources disclosed that the two Indian firms are discussing Tata’s bid to acquire Global Steel. “They are in serious negotiations,” the source said.

Danny Concepcion, legal counsel of Global Steel’s creditor banks said the steel firm can sell its assets provided it gets the approval of the financial institutions.

A ranking official of one of the creditor banks said they have heard that Global Steel is indeed for sale. “We heard about it but they have not discussed it formally with us,” the banker who requested anonymity said in a telephone interview.

The embattled company has been in the news recently after the Vietnamese government has accused it of using forged and fake documents in order to avail of the zero percent tariff. The discovery has led to the revocation of duty free privileges and the imposition of a seven percent duty on CRC from the Philippines.

The Vietnam government has revoked the Philippines’ right to sell steel products without additional fees after it has discovered that Global Steel has been using “forged and fake documents.”

Steel manufacturers from ASEAN countries have zero duty privileges when selling to fellow ASEAN countries. The imposition of duty will add to the cost of the product sourced from the Philippines.

However, Vietnam has imposed up to seven percent import tax on cold rolled coils (CRC) from the Philippines after the Vietnam Steel Association (VSA) discovered that Global Steel has allegedly been using forged and fake documents to make it appear that the products were made from the Philippines.

Global Steel has denied all the allegations.