Up to 59,037 tons of Chinese finishedsteel were imported into Vietnam through the Chua Ve Port in northern city of Hai Phong in the last two months.

The increasing amount of Chinese steel imports, which is partlydue to the latest governmental decision to cut down import taxes on finished steel to zero percent, equals to the local demand for construction steel coils in a month, local newspaper Labor reported on Friday.

Higher steel imports and lower demands are forcing local steel makers to scale down their production. They have planned to operate at 60 percent of their capacity to produce nearly 850,000 tons of steel between now and the end of July, said the Vietnam Steel Association (VSA).

To deal with the situation, the VSA has proposed the governmentto increase import tariffs on steel products from members of the Association of Southeast Asian Nations (ASEAN) to 10 percent and those from non-ASEAN members to 20 percent.

Vietnam imported nearly 1.7 million tons of finished steel, steel billets and iron worth 727 million dollars in the first fourmonths of this year, down 6.8 percent in volume, but up 20.9 percent in value over the same period last year.

The country imported 4.6 million tons of the goods worth nearly1.7 billion dollars in 2003, down 7.4 percent in volume, but up 24.1 percent in value against 2002. It is expected to consume 6-6.5 million tons of finished steel this year.