VietNamNet Bridge - Vietnam’s economy has displayed great growth in the past few years, boosting trade between the country and international markets. However,
Before kicking off a recent conference in
However, the conference room became too small when representatives from local and international companies such as Maersk Vietnam, Nike Vietnam, APL Vietnam and DP World rolled up for the two-day conference. Late-comers even had to stand because all the seats were occupied. The overwhelming response underscores how
The country’s impressive growth over the last several years has made
Master plan needs to be renewed
With 3,200 kilometres of coastline,
Under economic development pressure, investment capital is being pumped into port projects nationwide. More and more ports are being renovated and updated to meet international standards.
“We expect $4.5 billion to be invested in ports in the next five years,” said Tan Hua Joo, managing director of APL Vietnam Company, an international shipping firm in
In the north, seven leading domestic firms including Vietnam Shipbuilding Industry Group (Vinashin) and the Bank for Investment and Development of Vietnam last March announced they would build the Hai Ha port complex in Quang Ninh province, 100km from Quang Ninh’s Cai Lan seaport and 200km from
In the south,
Six investors were granted investment certificates for developing ports in the Cai Mep-Thi Vai port complex such as SP-PSA international port, Saigon International Vietnam and Saigon Premier Container Terminal.
Many seaports are located in the central region between Ha Tinh and Khanh Hoa provinces, including Vung Ang, Chan May, Danang, Ky Ha, Dung Quat and Quy Nhon ports.
However, these central region ports are operating under capacity. Last year, central region ports handled only 3 per cent of the country’s total cargo volume, while
He said a government plan to invest $3.5 billion by 2020 to turn Van Phong Bay in Khanh Hoa into a transhipment hub might lead to inefficiency as
Nguyen Thu, vice chairman of Vietnam Seaports Association, said: “The rapid increase in number of ports also created a price racing situation, where Vietnamese ports have reduced their price to attract customers. The direct results are lower service quality and an inability to reinvest into port development.”
Deputy Minister of Industry and Trade Nguyen Thanh Bien said the existing port development master plan, which was issued in 1999, was not suitable for the country’s current development.
“Many things have changed and we need a study and a new port development master plan to meet economic development requirements,” said Bien.
Although investors are pumping money into developing key ports in the country, the lack of supporting inland infrastructure is hindering port development.
“This could lead to the increase of handling costs from $3 to $5 per tonne of cargo and many business opportunities have been missed because both the carrier and shipper did not accept that handling price,” Vuong Dinh Lam, director of Vietnam Maritime Administration, said.
Cai Mep-Thi Vai port complex investors are also facing difficulties when developing their projects due to inadequate infrastructure and channel access. Due to the lack of inland infrastructure, the construction of some terminals will have to be done from the water’s edge which will negatively impact on construction timelines planned to be completed in 2009 or 2010.
Amanda Tucker, general director of Nike
Phu My bridge and No.2 Ring Road around
Besides the Ho Chi Minh-Long Thanh and the new Bien Hoa-Vung Tau highways, plans to dredge the entire access channel to the Cai Mep-Thi Vai terminals to a minimum depth of 14 metres and dredge the access channel to 10m in Hiep Phuoc port is still unclear.
Vietnam Seaports Association’s Nguyen Thu said if landside infrastructure and access channels were not adequately developed investment in
Impacting on the country’s economy
Tucker said with likely growth of 25 per cent to 30 per cent, the capacity shortage for shippers is likely to be more than 300,000 TEU.
“This means shippers can expect delays in loading containers on feeder vessels in 2007, especially during the peak shipping season.
“Current business operators are already looking at contingency plans should port and road congestion reaches crisis levels. These concerns and the likelihood of near term major port congestion could very well be undermining