Vietnam feasibility study - EITI

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etc. The Nghi Son oil refinery complex and the Dung Quat refinery plan would satisfy about 50% of
domestic consumption (PVN, 2011).
environmental protection activities
Mineral activities often cause negative impacts to the natural, social and built environment. Mining
projects and mineral processing are required to produce an environmental impact assessment (EIA) or
environmental commitments under the provisions of the Environmental Protection Law. Most current
mining projects and mineral processing have an EIA report. However, the extended EIA is not carried
out when the mining project expands its scale. Many minerals planning at both local and national scale
issued by provincial and central authority (as planned exploration and processing bauxite, titanium,
chromium, manganese, etc) have no reports of a Strategic Environmental Assessment. In general,
environmental protection measures often do not reflect the content of the EIA report. Furthermore,
the participation and engagement of civil society organizations and local communities in monitoring
and overseeing in this process are still limited (CODE, 2010).
Environmental rehabilitation activities based on the Decision No. 71/2008/QD-TTg issued by the
Prime Minister in 2008 have not yet been implemented in many localities. Although exploitation
activities are completed, environmental rehabilitation in many mining areas is not properly carried
out. In most mining projects, the environmental protection fee is not fully collected because the
extractive company often reports a lower production level to the governmental agencies when
compared to the reality to evade a part of this fee. Moreover, the environmental protection fee is
mainly used to mitigate environmentally adverse impacts derived from mining activities rather than
to prevent or limit such impacts based on government regulations. Moreover, this fund is not fairly
distributed sometimes. In some highly affected areas, the environmental protection is not considered
a priority. Consequently, the mining activities in some areas have caused serious negative impacts to
the environment, agriculture and local community’s life (CODE 2010).
I.2.3 The contribution and influence of the extractive industry
Contribution to social economic development
Generally speaking, the extractive industry has played a crucial role in the national economy
throughout decades. Regardless of oil and gas, the mining and quarrying industry accounted for 4.81%
of GDP by 1995 and increased to around 9.5%-10.59% from 2000 to 2008 (USGS, 2010; GSO, 2009).
Remarkably, revenue generated from crude oil only contributed 24.37% to state budget revenue in
2008 (GSO, 2008). The extractive industry does not only contribute to the national income, but also
brings in substantial foreign currency that helps to stabilize the national economy. By 2009, it brought
in about 8.5 billion USD from export, of which crude oil was the major commodity with 6.2 billion USD.
Furthermore, the mining sector creates a high number of jobs with 431,200 direct labors involved in it
and accounting for 0.96% of the total country’s workforce (GSO, 2008).
The initial contribution of the mining sector to national development is remarkable. However, the
mining industry has also exposed some weak points:
the position of mining sector in the national economy
Economic efficiency is not commensurate with capital investment: the investment for mining sector
is normally very high compared with total investment for the other sectors. However, the effective
contribution to GDP growth (i.e., the ratio of the contribution of mining to GDP / total investment in
mining) is not so high. For example, the total investment for the mining sector in the period of 2005-
2008 is ranked at five of 18 sectors. Meanwhile, the contribution to the national economy is ranked at
8 th compared to other economic sectors.
The Extractive Industries Transparency Initiative and the Implementation Perspective of Vietnam