A World Bank report showed that the expenses for logistics services accounted for 20.9 percent of Vietnam’s gross domestic product (GDP), of which transportation costs amount to 59 percent (Illustrative image. Source: VNA) Hanoi (VNA) – Ways to reduce logisticscosts and improve transport connectivity were the main topics of a nationalconference held in Hanoi on April 16 under the chair of Prime Minister NguyenXuan Phuc.
A World Bank report showed that the expenses forlogistics services accounted for 20.9 percent of Vietnam’s gross domesticproduct (GDP), of which transportation costs amount to 59 percent.
According to the Ministry of Transport, theshipping costs of a 40 feet container from Hanoi to Ho Chi Minh City (excludingloading and unloading costs) is estimated at 40 million VND (1,762 USD), 9.7times higher than that of sea routes and 2.5 times higher than that ofrailways.
The high costs of road transportation is due tounhealthy competition as transactions are conducted mainly throughintermediaries and transport businesses have failed to optimise their operations,Deputy Minister of Transport Nguyen Van Cong explained, adding that the costsof oil and petrol make up around 30-35 percent while the toll fees account forabout 10-15 percent.
Meanwhile, the transportation via railways,inland waterways and sea routes has yet been upgraded with long transport timeand expensive loading and unloading services, he said, adding that theconnectivity between transport businesses is limited and the information sboutthe market demand is insufficient.
To reduce logistics costs, the Ministry ofTransport said it is necessary to invest in building a national expresswaynetwork to ensure effective connectivity to industrial parks, key economiccentres, border gates, seaports, railway stations, and inland water ports.
The railway sector needs to build goodstransportation stations and upgrade loading and unloading facilities andwarehouses to provide common services for all transport enterprises.
Additionally, it is recommended to developcontainer transportation via inland waterways.
The transport ministry suggested forgingtransport connectivity between seaports, roads, railways and inland waterways.
Meanwhile, the aviation sector needs to developfreight services by establishing a cargo route network, encouraging investorsto build regional cargo airports, and providing incentives for airlines to openroutes to the cargo airports.-VNA
VNA
