The Central key economic zone: A breakthrough in logistics development

(Vietnam Logistics Review)“Developing trade via cross-border transport on the East- West economic corridor (EWEC)” and “together building logistics system and center in the Central key economic zone” are the names of a talk and a conference taken place in Danang on september 11th, 2016. In the event, Vietnam Logistics Association (VLA) has proposed important solutions for the development of trade activities via cross- border transport on the ewec and building logistics system and center and use them as a motivation force for the sustainable development of the ckez in the course of international integration.

The CKEZ, including provinces of ThuaThien, Hue, Quang Nam, Quang Ngai, BinhDinh and Danang City, has the area of 27,884 km2, accounting for 8.4% of the country’s area and has a population of 6.4m people, accounting for 7.2% of the country’s population. This is the area with geographical and political position of importance with sea ports, airports, National Road 1 and Trans-Asia Road and it is also located on the EWEC. It is of importance in the strategy of economic integration when Vietnam joins ASEAN Economic Community. And thus it is a breakthrough in developments of trade, logistics and economy. To achieve the goals, VLA has had suggestion to the Council of the CKEZ and the People’s Committee of Danang City.

Cross-border road transport (CBRP) plays an important role in transport of import- export goods, and transshipment goods among countries of the Greater Mekong Sub-region (GMS). Effective CBRP will contribute to value added, and improve competition ability of goods. There have been transshipment routes among Vietnam- Laos- Thailand- Shenzhen (China); Vietnam- Laos- Thailand- Myanmar and Vietnam- Cambodia. These routes should be maintained to push up the development of economy and logistics of the region.

However, the logistics service sector of the CKEZ has not developed as expected. Logistics service providers providing CBRT service from Vietnam and other countries as Laos, Thailand, and Myanmar have been dealing with difficulties, especially the limited amount of cargo due to the undeveloped trade of the EWEC.

There have been inadequacies in transshipment procedures at gateways, and there has been no cooperation among related offices. In addition, implementations of multi-border and bi-border agreements, especially the agreement of Facilitating Passengers and Cargo Cross- border Transport among Countries of the Mekong Greater Sub- region, 1999” has not been fully implemented in the country members. High extra fees, inadequate cooperation among country member, and inadequate roles of Coordination Committees have been counted to the ineffectiveness...

Therefore, how to overcome these difficulties and limitations and to make good use of regional cross- border transport? There must be solutions to be found and effective strategies for sustainable developments.

For achieving the targets,

- The Council of CKEZ and the People’s Committee of Danang should have strategies and particular action plans for the developments of cross-border road transport, especially on the EWEC to support medium and small-sized transport and logistics enterprises. Therefore, this can help facilitation of connecting international transshipment points as to China, Hong Kong (China) and Singapore. A board of instructions of the CKEZ should be founded to help the People’s Committee of Danang and the Council of CKEZ make policies, logistics infrastructures plans and the matter of cross- border transport.

Road systems connecting to Viet- Laos gateways in the economy zone should be improved, especially roads connecting gateways of Nam Giang and Danang, to make them a consolidating points and truck inspection points. This will help to liberate cargo and means of transport in peak times. The developments should be done in form of State- private cooperation: the Government provides lands, leasing and tax incentives; enterprises provide building capitals.

- A logistics center at Danang should be built to make good use of Danang airport and Tien Sa Port. Determinations from the People’s Committee of Danang and the Council of the CKEZ will make the center able to have breakthroughs, which will make good use of geographical advantages of the Center for traffic developments on the EWEC and the North- South transport axis.

- Improving procedures at gateways and increasing work hours of customs stations. In addition, IT should be applied to the process of doing procedures and one-stop inspection, the use of inspection devices should be applied too, which shortens time and cuts costs.

- Fees on transshipment cargo should be transparent, fees applied by local authorities should be removed and unofficial fees from Laos’ gateways to regional seaports and vice versa as well. Quality and morals of official and staff related to cross-border cargo transport should be improved, avoiding making it difficult for enterprises with extra fees that will cause extra costs and reduce competition abilities.

- There should be regional trade incentives to create cargo sources for transport sector and to reduce driving empty on return trip home as incentive mechanisms for transshipment cargo with lighter road fees, sea-port fees and transparent procedures.

Annual Cross- Border Road Transport hold at Danang will help the People’s Committee of Danang and the Council of the CKEZ in developing economy, trade, investments and cross- border transport. VLA will have cooperation, including inviting other associations and enterprises from neighbor countries.

It is expected that the Central of Vietnam, in the not too distant future, will have a developed logistics service sector that will contribute to improvements of competition abilities of the economy and the trade developments as well