Coca-Cola Vietnam more than double investment in Hanoi plant

As reported by newswire dantri.vn, Coca-Cola Vietnam has just announced that it would more than double its investment in the Coca-Cola project in Hanoi to $580 million.

The company would increase the capacity of the plant to 790 million litres a year in 2024 and 1.215 billion litres a year in 2030, as well as extend the project’s life to 50 years.

At the ceremony to hand over the certificate of investment, Nguyen Duc Chung, chairman of the Hanoi People’s Committee said he appreciated the contribution of American investors in general and Coca-Cola Vietnam in particular in the export of Hanoi as well as the city’s socioeconomic development. He said the city would do all it can to facilitate the operation of Coca-Cola Vietnam.

Coca-Cola Vietnam started investment in Vietnam with a project in Hanoi in 1994. The project is located in Duyen Thai commune of Thuong Tin district.

From 1994 to 2013 the company did not pay a dime of corporate income tax though it continuously invested in expanding operations. In 2014 however, the company reported profit and paid the authorities $20 million in tax.

The company was among many multinationals in operating in Vietnam suspected of transfer pricing. According to number earlier released, since its establishment in February of 1994 to the end of 2010 the company incurred cumulative loss of VND3.768 trillion ($166.8 million), higher than the initial investment of VND800 billion ($35.42 million). In 2011, 2012 and 2013 it continued to report loss. The reason for the loss, according to the company, is the very high cost of ingredients that it has to import from the parent company, and this expense accounts for between 70 and 85 per cent of the cost of production.

By Ha Duy / VIR