World Cement - July 2020

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Over recent years, the government has
invested significantly into infrastructure
development and will continue to do so
over the coming years as part of the ‘Build,
Build, Build’ programme, which will see
US$170 billion of planned investment
between 2017 and 2022. One example is
the Metro Manila Subway Line 9 project,
which will involve the construction of the
country’s first underground rail system at
a cost of US$7 billion for the 36 km route.
Scheduled for completion in 2025, the first
three stations are expected to open in 2022.
This drive towards infrastructure development
has benefited the Philippine cement industry,
which has seen demand growth of 11%
per year for the last five years and, until the
outbreak of the pandemic, had been expected
to see continued demand growth of 8% in
the coming years. Indeed, the Philippines is
the world’s 3rd largest cement importer, with
7 million t of clinker and 2 million t of cement
imported in 2018.
Vietnam has also undergone a remarkable
economic transformation over recent decades.
Economic reforms launched in the mid-1980s
spurred rapid growth and pushed what had
been one of the world’s poorest countries
into the lower middle-income bracket.
Between 2002 and 2018, the country’s GDP
grew by 270%, reaching US$2700 in 2019
and lifting 45 million people out of poverty.
Overall, the economy has been supported by
healthy domestic demand and export-oriented
manufacturing with data showing GDP growth
of 7% in 2019.
Like the Philippines, Vietnam has also been
investing heavily in infrastructure development
with transport networks and power generation
being a particular focus. Prior to the
pandemic, construction output was expected
to grow by 9.3% per year from 2019 – 2023.
The Ministry of Transport reported that
US$84 billion would be required to sufficiently
develop transport infrastructure from
2018 – 2023, with US$30.8 billion accounting
for road infrastructure, US$5.6 billion allocated
for rail, US$4.8 billion for the aviation sector,
and US$4.8 billion for marine transport.
Despite the scale of infrastructure
development in the country, Vietnam’s cement
sector is still faced with insufficient domestic
demand. In order to compensate for this,
Vietnamese cement producers have heavily
targeted the export market and, as of 2018,
Vietnam was the world’s leading cement