Illustrative image (Source: VNA) HCM City (VNS/VNA) - TheGovernment is trying to reduce the cost of goods transport in the country tomake logistics more competitive and one of the economic spearheads.
Logistics costs are very high in Vietnam,at around 20.8 percent of GDP, two to four times the rate in developedcountries.
In neighbouring Thailand, it is 16 percent,while in developed nations it is only 9–14 percent.
The major reason for the high transportcosts is that most goods are carried by road, which is more expensive thanrailway or waterway.
In recent times the Ministry of Transportand other related authorities have tried to improve waterway and railwaytransportation, but met with limited success.
“Waterway transportation is quite developedbut storage facilities are poor and it takes a long time to load and deliver,” BuiVan Quang, Chairman of the Ho Chi Minh City Goods Transportation Association,told Sai Gon Giai Phong (Liberated Sai Gon) newspaper.
His barge has to wait for 25 days to loadand unload at ports because they are small and their equipment and facilitiesare inadequate.
“This is too long a time to load and costsa lot and so logistics companies cannot wait.”
Rail transport is limited because stationsare small and have no space to store goods, he said.
This leaves roads for transporting most ofthe goods around the country, he said.
Despite the fact that the roadinfrastructure has received huge investments recently, the highway network doesnot meet demand, he said.
“Costs of road maintenance and buildingroads and bridges and parking fees have increased relentlessly, pushing up thecost of transport.”
HCM City’s ports suffer from a serious lackof parking space for trucks, and transporters have to pay 50-100 million VND (2,150– 4,300 USD) per square metre per month for parking.
Besides, more than 20-30 percent of truckshave to go to or return from ports empty due to lack of dynamic links betweentransporters and customers.
At the end of 2015, the Ministry ofTransport had licensed private company Vinatrucking as an intermediaryconnecting transport enterprises with customers.
But most transport companies joining theelectronic transportation exchange are foreign companies because only they canafford the cost of joining it.
To make logistics one of the key sectors,the Government has to do several things, Quan said.
“Ports need to enlarge their parking andstorage space and ports and trains must speed up loading and unloading ofgoods.”
Pham Thi Bich Hue, Chairwoman of the LongAn International Port, said the master plan for logistics development is poorlydrawn up.
“Logistics infrastructure is poor anddistances from depots and Inland Container Depots (ICDs) to ports are toogreat, which increases the cost and time taken for transportation.
“Related authorities must amend thelogistics master plan to create favourable conditions for enterprises tocompete.”
According to recent statistics, the totallogistics area in Vietnam is only around 280ha.
Of this, the south accounts for 265ha withthe Cat Lai Logistics Centre in HCM City alone making up 250ha.
Deputy Minister of the Transport Nguyen VanCong said: “Some localities have adjusted their master plan for transportdevelopment, including logistics. It suggests shutting down several ports andbuilding others.”
The ministry is working together withlocalities to review all transport master plans to create the most favourableconditions to develop transportation, he said.
“Many localities have strongly invested intransport infrastructure but port infrastructure needs more attention.”-VNS/VNA
Logistics costs are very high in Vietnam,at around 20.8 percent of GDP, two to four times the rate in developedcountries.
In neighbouring Thailand, it is 16 percent,while in developed nations it is only 9–14 percent.
The major reason for the high transportcosts is that most goods are carried by road, which is more expensive thanrailway or waterway.
In recent times the Ministry of Transportand other related authorities have tried to improve waterway and railwaytransportation, but met with limited success.
“Waterway transportation is quite developedbut storage facilities are poor and it takes a long time to load and deliver,” BuiVan Quang, Chairman of the Ho Chi Minh City Goods Transportation Association,told Sai Gon Giai Phong (Liberated Sai Gon) newspaper.
His barge has to wait for 25 days to loadand unload at ports because they are small and their equipment and facilitiesare inadequate.
“This is too long a time to load and costsa lot and so logistics companies cannot wait.”
Rail transport is limited because stationsare small and have no space to store goods, he said.
This leaves roads for transporting most ofthe goods around the country, he said.
Despite the fact that the roadinfrastructure has received huge investments recently, the highway network doesnot meet demand, he said.
“Costs of road maintenance and buildingroads and bridges and parking fees have increased relentlessly, pushing up thecost of transport.”
HCM City’s ports suffer from a serious lackof parking space for trucks, and transporters have to pay 50-100 million VND (2,150– 4,300 USD) per square metre per month for parking.
Besides, more than 20-30 percent of truckshave to go to or return from ports empty due to lack of dynamic links betweentransporters and customers.
At the end of 2015, the Ministry ofTransport had licensed private company Vinatrucking as an intermediaryconnecting transport enterprises with customers.
But most transport companies joining theelectronic transportation exchange are foreign companies because only they canafford the cost of joining it.
To make logistics one of the key sectors,the Government has to do several things, Quan said.
“Ports need to enlarge their parking andstorage space and ports and trains must speed up loading and unloading ofgoods.”
Pham Thi Bich Hue, Chairwoman of the LongAn International Port, said the master plan for logistics development is poorlydrawn up.
“Logistics infrastructure is poor anddistances from depots and Inland Container Depots (ICDs) to ports are toogreat, which increases the cost and time taken for transportation.
“Related authorities must amend thelogistics master plan to create favourable conditions for enterprises tocompete.”
According to recent statistics, the totallogistics area in Vietnam is only around 280ha.
Of this, the south accounts for 265ha withthe Cat Lai Logistics Centre in HCM City alone making up 250ha.
Deputy Minister of the Transport Nguyen VanCong said: “Some localities have adjusted their master plan for transportdevelopment, including logistics. It suggests shutting down several ports andbuilding others.”
The ministry is working together withlocalities to review all transport master plans to create the most favourableconditions to develop transportation, he said.
“Many localities have strongly invested intransport infrastructure but port infrastructure needs more attention.”-VNS/VNA
VNA
