Engineers operate transfomers in Ha Noi's Hoai Duc District. The country's energy sector witnessed a relatively high growth rate in the first two months of 2014 compared to the same period last year. — VNA/VNS Photo Ngoc Ha

HA NOI (Biz Hub) — The country's energy sector witnessed a relatively high growth rate in the initial two months of 2014 compared to the same period last year, stated the Ministry of Industry and Trade.

The figures released at a press meeting held in Ha Noi, on Tuesday, showed that the electricity production in February was estimated at 9.31 billion kWh, reducing 7 per cent as compared to the previous month, but increasing19 per cent in comparison to the same period last year.

The power output in the first two months of the year reached 19.33 billion kWh, posting a10 per cent year-on-year increase.

The petroleum sector also reported high growth of all key products in the period.

The coal exploitation output increased last month, while consumption was estimated at 2.78 million tonnes, reducing by 9.5 per cent in comparison to the corresponding period last year.

The total coal consumption in the first two months of the year reached 5.7 million tonnes, recording a 9.4 per cent year-on-year decrease.

Last month, the coal exports were recorded at 0.87 million tonnes, bringing the total during the two-month period to 1.4 million tonnes.

The domestic coal consumption during the period was 4.4 million tonnes, increasing 1.3 per cent over the same period last year.

The ministry also noted that the steel consumption during the period saw a 30 per cent year-on-year decrease and was recorded at 300,000 tonnes.

The steel inventory during the period saw a sharp increase of 40 per cent as compared to the same period last year.

Le Phu Hung, the general director of Viet Nam Steel Corporation (Vinasteel) said that steel production and consumption were still facing difficulties due to the low purchasing power.

Hung added that the corporation reported losses in the last two consecutive years, though it accounted for 40 per cent of the country's market share.

Its revenue in the initial two months of the year was recorded at VND7.2 trillion (US$342.86 million), accounting for 14.2 per cent of the entire year's target.

The ministry claimed that the steel supply surpassed the demand, thus making it difficult for businesses to increase prices while retaining customers. It has forecast that the total steel consumption for 2014 will be 12.2-12.5 million tonnes, increasing only 3-5 per cent over the last year.

With regard to investment in the sector, Deputy Minister Le Duong Quang requested Vinasteel to make the Thai Nguyen Steel Factory operational as per set schedule.

In addition, Quang urged the corporation to accelerate its restructuring process in order to reduce intermediate costs.

"Vinasteel should carefully review its capacity of Engineering, Procurement and Construction (EPC) or it will have to focus on restructuring its member companies," he explained.

Fielding questions on a possible increase in electricity tariff, Dang Huy Cuong, the head of the ministry's Electricity Regulatory Authority of Viet Nam reported that they had not yet received any proposal from the Electricity of Viet Nam for any adjustment.

"The adjustment will have to follow several legal documents, such as Decision 69/2013 on average electricity mechanism and electricity retail price framework," he noted, adding that they would also take into consideration macroeconomic factors and CPI. — VNS