Vietnam will lower import duties on polypropylene to 1% from 3%, effective March 6, the country's ministry of finance said.
The new tariff applies to PP under HS (harmonized system) codes 39021030 (PP in liquid or paste) and 39021090 (PP in other forms).
The reduction will be a benefit to domestic converters as the country is a net importer of PP. The 3% tariff has been in place since 2013.
Vietnam's annual PP deficit is expected to reach 938,000 mt in 2016, widening to 1 million mt by 2017.
The country has almost no domestic PP capacity, with the exception of PetroVietnam's 150,000 mt/year PP plant at Binh Son.
Vietnam is expected to be one of Southeast Asia's hottest growth markets, with demand forecast to grow annually by 7% in 2016 and beyond, according to Platts Petrochemical Analytics.
Amid the tariff cuts, Vietnam has free trade agreements with China and ASEAN members, which means PP imports from those countries are duty free.
