Mr Cheong Ku Wei, General Director of BlueScope Steel Vietnam (BSS VN)

What have been the most significant achievements of BSS VN since its establishment in 1993?
BlueScope was among the pioneers in producing high quality roofing and walling products with Zinc/Alu coated steel when we first started our rollforming business here in Vietnam in 1993 and has been heavily promoting this product and material combinations ever since. Today there are more than 600 local rollformers in the Vietnam market and we can proudly say that we have contributed significantly to the growth of this industry.
BlueScope Steel Vietnam is the first BlueScope business that ventured into the pre-engineered building (PEB) business. Positive encouragement in this business led to the acquisition of Butler Buildings in 2004, the world’s largest PEB supplier, operating mainly in North America and China. BlueScope Steel Vietnam has definitely played a role in igniting BlueScope Steel’s venture into this business.
One of the major achievements will be the $105 million investment by BlueScope Steel Limited into the most advanced metal coating and paint line facility in all of Asia. BlueScope Steel Vietnam is the only facility in the region that can perform metallic coating and painting continuously on a coil in one simple run. BlueScope Steel Vietnam has been fortunate enough to contribute via IFRC (International Federation of Red Cross and Red Crescent) to the development of a design concept for typhoon and flood resistant core house kits and has supplied more than 10,000 units to people in the central region and Mekong Delta.
 The economic recession had a major impact on all sectors in 2008-2009. Steel was no exception, so what were the difficulties BSS VN experienced over the past two years and what are the challenges in 2010?
During the economic recession in 2008 all sectors were impacted, including steel. BlueScope Steel Vietnam, like any other company, will have to take careful steps to remain competitive, that is to manage costs effectively. Restructuring was inevitable and we have scaled down our business in all areas while retaining key employees in the company. This exercise involves all levels and one of the greatest outcomes you can see after the exercise today is that we have a lot more local people in the business and even 75 per cent of the management team now are capable local people. This has also directly given the opportunity to local people to play a more important role in the business.
BlueScope Steel Vietnam has also reduced inventory levels significantly, to the minimum level. We have been successful in doing this despite the intense competition in the market place at this time. We also diversified our focus into exploring new markets and customers both domestically and in exports, to keep our production line running. This venture has also improved our position in the domestic market now when the market is slowly picking up again. The challenges that we see in 2010 is that the high bank loan rate will impact investment growth of local projects. This is no doubt very obvious. Furthermore, coupled with an increase in steel price, it might lead to another possible crisis.
How do you forecast the steel industry’s development in 2010 and onwards? What will be the significant changes in your view?
We see that supply will double demand in 2010 for flat steel mid stream in Vietnam. This will have some impact, but with low steel consumption per capita (120kg in 2009) there will be significant growth for demand in steel as well. The investment for steel projects will come and consumption will continue to grow to more than 15 per cent a year. We are very optimistic on the growth in demand for steel in very near future. With supply doubling and increased competition in the local market, manufacturers will have multiple focuses, including exports, and this scenario will encourage Vietnam to be the Number 1 flat steel exporter within the ASEAN region for CRC and coated/painted steel.
According to forecasts from the Vietnam Steel Association (VSA), the steel market will hopefully recover in 2010. In this post crisis context, what will be BSS VN’s strategies for development in Vietnam?
As mentioned earlier, we are extremely optimistic about the growth of the steel market in Vietnam and we are getting ourselves prepared. Our production line has been building back into full shifts to build up our capacity. For 2010 we have developed a new multi-channel strategy called “bamboo”, to focus on expanding the domestic market. This strategy will predominantly encourage the growth of our downstream businesses throughout Vietnam. We will also still continue to supply to our export markets in Africa, South America, Europe and some parts of Asia.
Besides safety and environmental protection, corporate social responsibility (CSR) is also of great concern to all manufacturers. What does BSS VN do in this regard?
When we talk about CSR, it comprises many aspects. They include company culture, benefit to the employee, anti-corruption, environmental protection, working conditions, gaps between staff and leaders, and community contribution. All BlueScope Steel businesses are guided by our strong principle called “Our Bond”. This principle is the basic fundamentals that all businesses need to adhere to create a safe, healthy and conducive environment for all our employees, shareholders and customers. In BlueScope Steel Vietnam, the Labour Union has a very strong voice to management. They constantly communicate to the management team about their concerns and the company has an excellent relationship with the union.
Safety has always been the Number 1 priority for BlueScope and we have emphasised and practiced safety policies and a culture of safety in all our businesses, with comprehensive safety and environmental programs, to ensure all employees are safe at the workplace. We also provide ethics training for all employees through our Business Conduct Program annually. At BlueScope we promote communication at all levels, from the presidents to all levels of employees. We have a very healthy communication session quarterly between the president and all employees about our safety performance, business performance, marketing strategy, employee welfare and other employee-related topics.
BlueScope Steel Vietnam has also been active in contributing to the community with our involvement in HABITAT, donations to homeless storm victims, and building local standards, etc.
Source: VET