Local logistics associations contributing to developments of the national logistics sector

With remarkable progress in recent years, Vietnam’s logistics service sector has been identified by the Party and the Government as an important service sector in the overall structure of the national economy

Local logistics business associations- an essential need for development

In 2018, World Bank published the report “Connecting to Compete 2018 Trade Logistics in the Global Economy - The Logistics Performance Index and Its Indicators. Vietnam was ranked 39/160 countries participating in the survey- an increase of 25 rank compared to the rank of 64/160 in 2016. The point was 3.27 compare to 2.98 of 2016- an increase of 0.29. Number one was Germany and the 160th, Afghanistan. In the ASEAN, Vietnam was ranked third after Singapore (rank 7) and Thailand (rank 32).

With remarkable progress in recent years, Vietnam’s logistics service sector has been identified by the Party and the Government as an important service sector in the overall structure of the national economy, playing a role of supporting, connecting and promoting socioeconomic development of the countries and localities and contributing in improving competition abilities of the economy. The 13th National Party Congress set out directions and tasks for the 5-year period of socio-economic development (2021- 2025), which clearly stated:” In term of services, promoting and improving sectors’ quality, giving priorities to those of high advantages, high content of knowledge and added values… improving efficiency of the logistics services”. The Decision no.221/ QD-TTg dated February 22, 2021 by the Prime Minister “Amending and Supplementing the Decision no.200/ QD-TTg on approving the Action Plan to improve competition abilities and developing Vietnam’s logistics sector to 2025” (the Decision 221) has set a target: by 2025, the logistics service sector’s contribution to GDP will reach 5% - 6%; logistics service growth rate will reach 15% - 20%; logistics service outsource rate will reach 50% - 60%; logistics costs will reduce equally to 16% - 20% of GDP; and the global LPI rank will be 50 or up.

Along with the development of the logistics service sector, the number of LSPs has also increased significantly, with more than 4,000 domestic and international service providers concentrated in big cities as HCMC, Hanoi, Hai Phong, Danang, Binh Duong, Ba Ria - Vung Tau, and in the Mekong Delta... In the context, local logistics business associations have also been gradually formed with the desire to connecting and gathering businesses in the same field to cooperate, to share information, experiences, opportunities and to join hands for sustainable development of the local and national logistics sector. Most recently, on July 8, 2021, the City People’s Committee of HCMC issued the Decision no. 2474/QD/UBND on the establishment of the HCMC Logistics Service Business Association. This is the 2nd local logistics business association having officially established after Binh Duong Logistics Association. Previously in April 2021, after the Hai Phong Logistics Service Development Association Conference, with the active support of the Vietnam Logistics Business Association (VLA) - the National Association - the Association’s Advocacy Board of Hai Phong Logistics Service Business Association was launched towards the establishment of the Association in the near future. On August 24, Hai Phong Logistics Business Association was officially established in accordance to the Decision no.2416/QD-UBND by the People’s Committee of Hai Phong.

Together with VLA- the national logistics association, local logistics business associations will be active elements to promote development of the Vietnam logistics sector

In the development directions of theTerm VIII (2021 - 2021), VLA set out tasks to support the establishment of local logistics service business associations in order to implement Task 54 in the Decision 221: “Promoting the role of associations in the field of logistics in order to determine the vision, development orientation and support enterprises in logistics business, human resource development in the logistics industry”.

VLA will promote and fully support the establishment of logistics service business associations in localities as Hai Phong, Can Tho, Hanoi, and HCMC, Ba Ria - Vung Tau, and Danang...

Therefore, VLA will promote and fully support the establishment of logistics service business associations in localities as Hai Phong, Can Tho, Hanoi, and HCMC, Ba Ria - Vung Tau, and Danang... The establishment of the local logistics service business associations has a big goal of gathering and connecting businesses in the logistics industry chain, providing overall services through improving linkages between businesses, developing highquality logistics human resources, and accelerating the digital transformation in Vietnam’s logistics service industry, thereby effectively supporting the VLA Association in developing the logistics service sector in our country as required.

Together with VLA, the local logistics service business associations will be a “bridge” between enterprises in the sector and the State’s management agencies at central and local levels. If the VLA gives feedback to the central authority, then logistics associations of the provinces and cities will present the views, recommendations and proposals of businesses to the State’s management agencies at the relevant level local. Therefore, State management agencies at all levels will have synchronous solutions from central to local levels to contribute to the development of Vietnam’s logistics sector. Together, we will definitely overcome the difficulties from the pandemic of COVID-19, contributing to development of the supply chain and the logistics service sector in our country, aiming towards the “aspiration of 2045” of the country.