Oct 12, 2005. /Lesprom Network/. Vietnam had 28,500 tons of paper in inventory in the first nine months of this year, mainly because of an influx of imports with lower prices, the Trade Ministry. The main reason for the situation is Vietnam's heavy reliance on imported pulp, the key material for paper production. Last year, it imported 200,000 tons of pulp or around 75% of its total need, reported Xinhua News Agency. Other contributing factors include increasing prices of fuels and other inputs in the world market and outdated technologies used by Vietnamese paper enterprises. The situation will worsen next year when Vietnam is to slash paper import tariffs to 5 percent from current 15-10 percent under the ASEAN (Association of Southeast Asian Nations) Free Trade Area, local experts said. An encouraging sign for the local paper industry is emerging as two foreign firms want to team up with a local partner to establish the biggest paper pulp joint venture in Vietnam. "The New York-based International Finances Development Corp, the Sweden-based Industrial Project Services Patents and a Vietnamese firm, the Hiep Phuoc Paper Company in Ho Chi Minh City, are seeking license for building a factory with annual capacity of 450,000 tons of pulp in our province," the Department of Planning and Investment of central Phu Yen province told Xinhua. Investment for the project is estimated at 1.1 billion US dollars, including some 900 million dollars for construction and 200 million dollars for plantation of 150,000 hectares of forests. Vietnam, which has to import 70-80 percent of its pulp and various kinds of high-quality paper, has yet to attract any foreign-invested projects in pulp production and afforestation. The country, which imported 461,000 tons of paper worth 245 million dollars last year, imported 421,000 tons of the product valued at 261 million dollars in the first 9 months of this year, posting year-on-year rises of 22.9 percent and 47.6 percent respectively, according to the country's General Statistics Office.