Ba Ria-Vung Tau: On The Roadmap For ASEAN Logistics Integration

At present, trade relationships with ASEAN members have brought back 25% exports of Vietnam. Therefore, carrying out the integration roadmap will be of importance in developing logistics services of Vietnam in general and that of Ba Ria-Vung Tau (BR-VT) in particular following the WTO commitment in 2004. It is an opportunity for BR-VT to achieve the target of being a leading logistics center of the country and of the region.

THE ROADMAP FOR LOGISTICS LIBERALIZATION OF ASEAN REGION

It is the developing logistics services that has become a remarkable feature in policies of ASEAN countries. The target is to have an ASEAN single market by 2015 by strengthening economic integration through liberalization and facilitation measures in the area of logistics services. It is supposed to have a unified ASEAN logistics environment by 2013, making ASEAN a logistics center of the Asia-Pacific.

The measures of the process include particular acts that will be carried out by ASEAN members to increase competitive abilities of logistics services providers. The roadmap was divided into 5 objectives with 44 measures in detail:

1. Liberalizing significantly specific logistics services
2. Facilitating trade, customs, and logistics transport to enhance ASEAN logistics service providers’ competitiveness
3. Increasing abilities of ASEAN logistics services providers
4. Developing human resource
5. Improving infrastructures, multi-modal transport and encouraging investments

At present, Vietnam logistics cost is rather high, which accounts for 25% GDP (15% in other countries). This weakens the competitiveness of Vietnam’s services and goods. And in the tough period of competition, international logistics providers have surpassed Vietnamese competitors in all aspects. Therefore, Vietnam should ensure good implementation of logistics integration and build a clearer legal environment for a better logistics development.

Vietnam, at present, is in the process of improving its framework, of enhancing the Government’s management abilities, and building particular policies on logistics. And remarkable liberalization has been achieved in some logistics service-related businesses, a level of required protection to some services as deliveries, distribution, railroad transport, road transport has been achieved too. In some businesses of advantages as loading/unloading container service to sea freight, warehousing or clearance service, Vietnam has also set a limit of 50% to foreign contributed capital or set a 5 to 7 year roadmap for foreign capital increase. The deadline of 2013 has been set for the liberalization of almost major businesses of logistics service sector among ASEAN country members.

BR-VT ON THE ROAD MAP FOR INTEGRATION TO ASEAN

BR-VT has set the target:”…developing sea-based economy, making BR-VT an industrial sea-port province in 2015…” The sea port system no.5 has been responsible for 50% of the total cargo that go through the country’s sea port system, accounted for 60% of the total exports, and had the average growth of 21%/year. Therefore it is considered as a solution to develop Vietnam economy to 2020.

BR-VT, located in the Southern key economic zone with favorable natural conditions, has become the gathering point of many international routes and also become a gathering and distribution point of export goods from the South Eastern region to South East Asia countries and the world. Therefore, the development of sea ports has closely connected to the development of logistics services in a system of multi-modal transport. BR-VT with its advantages has been on its way to the integration to regional and international logistics.

24 ports mainly located in the area of Cai Mep-ThiVai of the total of the planned 55 sea ports have been put into operation with the capacity of 67 million tons of cargo annually. And some international ports have been able to receive large vessels of up to 50,000 tons with direct routes to the U.S or Europe, which can save time and cut costs as well. There have been 5,000 businesses in the province doing business or investing in different sectors, among which are some key economic sectors as oil, power, fertilizer, food processing, steel, tourism, fishery…There have been 280 foreign investment projects with total capital of 27 billion dollars; there have been 14 industrial parks and 30 industrial groups in the area of 11,000 ha. These things are considered as premises to the development and integration of BR-VT to the logistics world, aiming to the targets of completing the provincial sea port system by 2020 with the capacity of 250 million tons/year, and having the cargo through put of 60 million tons in 2015, and 120 tons in 2020.