VLA with targets of improving competition abilities for Vietnam logistics sector

(Vietnam Logistics Review) Recent innovations on administration and legal policies from ministries, sectors and from the Government have made it possible for Vietnam logistics enterprises to improve their competition abilities. And there have been no small contributions from Vietnam Logistics Association (VLA) from its consultancy and arguments with management organization, policies planners about difficulties and matters enterprises have to deal with.

From action plan in decision 200

With the function of protecting its members’ interests, the Association has had closed relationship with the State- owned management organizations as the Ministry of Transport, the Ministry of Industry Trade, the Ministry of Planning and Investment, the Ministry of Finance (General Department of Customs, General Department of Taxation), contributed ideas to related legal documents, reported difficulties enterprises have to deal with for on-time solutions.

With the guidance from the Ministry of Industry Trade and based on operation reality of logistics enterprises, VLA successfully contributed in making Action Plan for Logistics to 2020, vision to 2030. On the basis of the plan, February 14th, 2017, the Government issued the Decision 200/QĐTTg on approving the Action Plan for Upgrading Competition Abilities and Developing Vietnam’s Logistics Services to 2025- a remarkable milestone in the course of development of Vietnam logistics sector.

Decision 200 set the target of cutting logistics cost to equally 16%-20% of GDP from now to 2025. To make it possible, right after the Decision approved, VLA was assigned to implement 10 out of 60 tasks in the Decision.

To consultancy on positive changes in reality

One of the important tasks is to cooperate with related ministries and sectors “to improve assisting policies to enterprises operating in the field of logistics services”. And VLA has played a good role in consultancy and giving arguments to management offices in order to have adjustments or modifications to circular letters, resolutions in the direction of making it easier for enterprises of logistics services as modifying Resolution no.19 by giving solutions and making Resolution’s targets closers to enterprises’ activities.

After 4 years of implementing the Resolution no.19 by the Government (2014 - 2017), business environment and competition abilities of Vietnam’s enterprises have been improved. However, there have been enterprises having to deal with paperwork related to specialized inspection and cargo clearance. In some administrative stages, procedures have been so complicated. Therefore, it is an immediate must-do to remove conditions causing difficulties to enterprises. From the reality, Resolution no.19-2018/ NQ-CP (Resolution 19/2018) on implementing tasks and solutions to improve business environment and national competition abilities in 2018 and the next coming years has just been issued in May 2018. It is expected the resolution will help to solve various problems.

To the logistics sector, Resolution 19/2018 aims at improving competition abilities of the logistics sector to make profits, to cut business expenses, and to support economic structure changing. Paticularly to reduce logistics cost to around 18% of GDP (currently over 20% GDP), increasing Logistics Efficiency Index to 10 more ranks (currently ranked 64/150 countries). And particular tasks have been assigned to related sectors and regions. VLA in the role of consultancy is a bridge between enterprises and management offices.

The Ministry of Finance should apply using IT in management and inspection of cargo and means of transport carrying import - export cargo in transit under customs inspection. At the same time, National Single Window (NSW) and ASEAN Single Window (ASW) should be efficiently carried out. The focus of 2018 is to carry out 130 new registered administration procedures as in Master Plan of Carrying out NSW and ASW in the period 2016-2020; and the ministry, together with related ministries and sectors, should develop IT systems serving NSW and ASW, ensuring connectivity, security, information safety…

The Ministry of Transport cooperates with other ministries, sectors, organizations and local authorities to implement practical solutions to cut logistics costs: checking and cutting road fees; controlling situation of unregulated fees to import-export cargo from shipping companies; doing research and completing plans for ICDs in the country in the direction of balance them from regions to regions; balancing import and export cargo; increasing frequency of 2-way transport; assisting transport companies by connecting them and sharing information between shippers and transport companies.

At the same time, solutions to develop logistics infrastructure structures should be carried out as gradually building local water ports with modern equipment for efficient connectivity among ports in the country; improving transport ability by railroad; saving time and increasing trust and service quality; researching expansion of transport works, yards and logistics centers on routes and corridors connecting sea ports and local water ports of Vietnam’s to those of Lao’s, Cambodia’s, Thailand’s and Southern China’s; researching development of airline logistics centers, in which logistics centers connecting airports serving special cargo (dangerous cargo, high-value cargo, hi-tech cargo, and cargo that needs special preservation…) should be paid more attention to; implementing developments of 3 specialized airline logistics serving international airports as Noi Bai, Danang and Tan Son Nhat…

The Ministry of Industry - Trade cooperates with other ministries, organizations and local authorities support logistics enterprises improving business and management abilities for better efficiency; developing logistics outsourcing; persuading shippers to use more services from enterprises providing specialized logistics services; encouraging industrial parks and processing zones to provide closed logistics services to help enterprises to save time and cut cost from material and product forwarding.

To have better cooperation with ministries, sectors and local authorities to complete the assignments, VLA, in the next period of development, will play a better role of consultancy to report difficulties from logistics enterprises. The organization keeps accompanying with enterprises to bring ideas from enterprises to the State’s organizations and together with the Government to make more practical policies to bring the logistics sector to a new stature: more comprehensive, more professional, more integrated and more profitable to enterprises.