JFE Steel to invest $220mln

Tokyo
JFE Steel, Japan's second-biggest steelmaker, said on Thursday it would invest 27 billion yen ($220 million) in a steelworks being built by Taiwan's Formosa Plastics Group in Vietnam in a bid to expand its global network to drive growth.
The decision comes at a time when the steel industry globally is struggling with overcapacity and sluggish demand in China, the world's top buyer. "This investment is based on our mid- to long-term growth strategy," Shinichi Okada, executive vice-president of JFE Holdings Inc, JFE Steel's parent, told a news conference on its earnings on Thursday.
"It is obvious that Japan's local demand will be shrinking. Our long-term growth has to come from elsewhere in Asia," he said.
JFE plans to take a 5 percent stake in the plant's operating company, Formosa Ha Tinh Steel (FHS), which is investing $10.5 billion in the first phase to build a hot rolling mill, blast furnaces and steelmaking facility in Vietnam's central Ha Tinh Province.