Mekong Delta needs logistics investment: officials

August 26, 2019 - 08:36
Nguyễn Hoài Nam, deputy general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said the move would allow firms to directly export their goods.



The situation of being stuck in ports and overloading at some key ports in the South East region takes place regularly, creating conditions for shipping enterprises to increase service charges. VNA/VNS Photo Xuân Khu


HÀ NỘI A trade representative has called for the construction of more deep-water ports in the Mekong River Delta to save money and time for seafood exporters.

Nguyễn Hoài Nam, deputy general secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said the move would allow firms to directly export their goods.

High logistics costs

Most of the Mekong Delta's export turnover is made up of rice and processed seafood products. Every year, the region's transportation demand for export goods is about 17-18 million tonnes. However, 70 per cent of export products have to be transferred to major ports in HCM City and Cái Mép port (Bà Rịa - Vũng Tàu Province), increasing transportation by 10-40 per cent depending on the route.

This situation leads to frequent overloads on the connecting routes from HCM City to Mekong Delta provinces. In addition, transport service quality is poor, costs are high and there is a lack of links between different modes of transport.

As one of the largest frozen shrimp exporters in the world, Minh Phú Seafood Joint Stock Company annually exports about 6,700-7,000 shrimp containers with a turnover of US$750 - 850 million.

Chu Văn An, deputy general director of Minh Phú Seafood, said if there was a more suitable logistics service, goods could be exported directly from the Mekong Delta and businesses could save 30-40 per cent of their costs, which would increase the competitiveness of agricultural products.

Focused investment in regional transport infrastructure would help tackle the problem, with waterways investment the best option due to the area's terrain.

A representative of Cà Mau Province's transport department urged prioritising investment in inland waterways that are connected with road traffic to enhance transport capacity throughout the region, and to exploit the waterway system linking HCM City with other provinces and cities in the region.

The Ministry of Transport said that it will study and implement a dredging project and renovate Khai Đốc Phủ Hiền canal connecting the Tiền and Hậu rivers to shorten the transport distance between Cần Thơ port and the seaport in the southeast.

The ministry also plans to upgrade inland waterway routes such as HCM City to Kiên Lương and HCM City to Cà Mau. It will also focus on improving the transportation infrastructure system, reducing congestion on main waterways and cutting the cost of transporting goods from manufacturers to consumers, Minister of Transport Nguyễn Văn Thể said.

Forming a logistics centre

According to Nam, there is a lack of seaports in the delta, especially deep-water ports capable of handling export container ships.

Meanwhile, goods being stuck at ports and overloads at some key ports in the southeast region occur regularly, allowing shipping enterprises to increase service charges and wasting businesses' warehouse costs and time.

An Giang Province is a big exporter and processor of seafood, but difficulties in transport infrastructure have affected the development of enterprises.

As a unit specialising in raising and processing tra fish and basa fish for export, Nguyễn Anh Thư, deputy general director of An Mỹ Fish Joint Stock Company, said the province's transport system lacks synchronisation. This has caused  difficulties and increased costs for businesses as goods cannot be transported by container trucks but must be carried by small trucks.

It is forecast that the transportation demand for the region's rice by 2020 will be about 10.2 million tonnes and aquaculture output will be about 2.42 million tonnes.

This shows the logistics market of the Mekong Delta has potential to develop and attract investors, according to Nguyễn Minh Toại, director of Cần Thơ Province’s Department of Industry and Trade.

He said developing logistics services and building a regional level logistics centre was an urgent need.

To meet demand for import and export of regional goods, the Ministry of Transport asks the Prime Minister for approval to adjust planning for Sóc Trăng and Trần Đề seaports to seek investment and form a gateway seaport to receive vessels of up to 100,000 tonnes.

Besides, the ministry proposed the Government and the National Assembly approve the allocation of capital to upgrade the second phase of Chợ Gạo canal and complete investment procedures for the southern region waterways and transport logistics corridor project with loans from the World Bank. VNS