HAI PHONG LOGISTICS: STILL "TO BE WORKED FOR PROFIT"

Being identified as a modern international logistics center, Hai Phong's logistics picture is still in a simple state, not creating much added value.

"Wise home, foolish market"

A shipper in Hung Yen exports a shipment to overseas through Hai Phong port, for each 20-foot container, this business has to pay the shipping line about 100 USD and 170 USD for each 40-foot container THC (Terminal Handling Charge – Charges for loading and unloading goods at the port). However, the loading and unloading rates that shipping lines pay to seaport enterprises only fluctuate at about 33-52 USD/cont 20' and 50-77 USD/cont 40'. This price is only equivalent to 30-45% of the THC price. This is considered the lowest price for loading and unloading in the region, even far behind Cambodia, Malaysia, Indonesia, etc. And painfully, 90% of those shipping lines are foreign.

It is worth mentioning that this THC fee is completely determined by the shipping company without any agreement with the customer. Hai Phong port enterprises in particular and the whole country in general had to pity to see the lucrative piece of cake falling into the hands of ship owners. Only one HICT port handles about 1 million TEUs (equivalent to 1 million 20-foot containers) each year, and this business loses about 20 million USD/year. And, if the throughput of goods through Hai Phong port in 2022 is 168 million tons, of which, the container volume of 6.5 million TEUs has lost hundreds of millions of dollars from the hands of seaport enterprises.

The story of loading and unloading is only one part of the overall picture of Hai Phong logistics activities. In a recent report of Hai Phong Department of Industry and Trade, Hai Phong is one of two localities (Quang Ninh) that converges all five types of traffic. However, transportation costs are still high due to unreasonable organization. Road transport alone accounts for 80% of cargo through the port, so congestion often occurs. The railway connects the port to Hanoi - Lao Cai - Kunming but was built more than a century ago. There are 14 national inland waterway transport routes and 17 local inland waterway routes, but they mainly transport bulk and small goods. There is Cat Bi international airport with a capacity of 4 million passengers/year, but the cargo volume is only 0.4 million tons/year.

In addition to the convenient transportation system, Hai Phong has established 4 logistics centers. In which, 2 centers have been operating: Green logistics center, Yusen Logistics logistics center (Dinh Vu Industrial Park); Two centers are being built, namely CDC logistics center (Dinh Vu Industrial Park 2), and Lach Huyen Gateway Port Industrial Park (DEEP C III).

"Wise home, foolish market"

A shipper in Hung Yen exports a shipment to overseas through Hai Phong port, for each 20-foot container, this business has to pay the shipping line about 100 USD and 170 USD for each 40-foot container THC (Terminal Handling Charge – Charges for loading and unloading goods at the port). However, the loading and unloading rates that shipping lines pay to seaport enterprises only fluctuate at about 33-52 USD/cont 20' and 50-77 USD/cont 40'. This price is only equivalent to 30-45% of the THC price. This is considered the lowest price for loading and unloading in the region, even far behind Cambodia, Malaysia, Indonesia, etc. And painfully, 90% of those shipping lines are foreign.

It is worth mentioning that this THC fee is completely determined by the shipping company without any agreement with the customer. Hai Phong port enterprises in particular and the whole country in general had to pity to see the lucrative piece of cake falling into the hands of ship owners. Only one HICT port handles about 1 million TEUs (equivalent to 1 million 20-foot containers) each year, and this business loses about 20 million USD/year. And, if the throughput of goods through Hai Phong port in 2022 is 168 million tons, of which, the container volume of 6.5 million TEUs has lost hundreds of millions of dollars from the hands of seaport enterprises.

The story of loading and unloading is only one part of the overall picture of Hai Phong logistics activities. In a recent report of Hai Phong Department of Industry and Trade, Hai Phong is one of two localities (Quang Ninh) that converges all five types of traffic. However, transportation costs are still high due to unreasonable organization. Road transport alone accounts for 80% of cargo through the port, so congestion often occurs. The railway connects the port to Hanoi - Lao Cai - Kunming but was built more than a century ago. There are 14 national inland waterway transport routes and 17 local inland waterway routes, but they mainly transport bulk and small goods. There is Cat Bi international airport with a capacity of 4 million passengers/year, but the cargo volume is only 0.4 million tons/year.

In addition to the convenient transportation system, Hai Phong has established 4 logistics centers. In which, 2 centers have been operating: Green logistics center, Yusen Logistics logistics center (Dinh Vu Industrial Park); Two centers are being built, namely CDC logistics center (Dinh Vu Industrial Park 2), and Lach Huyen Gateway Port Industrial Park (DEEP C III). 

Difficult goals "International Center"

In logistics planning, by 2030 with a vision to 2045, Hai Phong will become a modern international logistics center. However, according to Mr. Tran Tien Dung, Chairman of Hai Phong Logistics Association, the logistics services of Hai Phong are still quite simple and have not created much added value. Logistics businesses as well as the Hai Phong Logistics Association are also very confused about how to fulfill the expectations set by the central government and the city because there is not really a specific direction.

“The Hai Phong logistics business community also expects that the construction of Xuan Cau non-tariff zone in the recent past with a specific mechanism will be one of the pioneering projects in promoting and calling for the business community businesses to invest, deploy more logistics services, attract foreign investors, create more logistics services, create more motivation and revenue for the locality in the coming time "- Mr. Dung said. know.

Regarding traffic - the key issue that determines logistics costs, according to Ms. Nguyen Thi Phuong Hien, Deputy Director of the Institute of Transport Strategy and Development (Ministry of Transport), this is the most important issue that needs to be prioritized. resolved in the coming years. The transportation sector has two major considerations that need to be focused on development in the coming year, namely railway connection, Hai Phong related to relocation of old railway and treatment of railway hub connecting Lach Huyen, Dinh Vu, Nam Do Son. “The cargo market potential of Hai Phong port not only serves the industrial development of the locality, the Red River Delta but also the Northwest and South China provinces. Therefore, when developing a logistics strategy, Hai Phong needs to consider more," emphasized Ms. Hien.

The digital transformation in logistics, Hai Phong has a number of solutions, but there is little shadow of green logistics, green ports, green transportation. The Prime Minister has made a decision on green transformation in transportation with a very clear roadmap for all 5 modes of transport. In which, requirements for the development of green ports, logistics centers, inland ports, green transport services. Therefore, logistics development is the goal that Hai Phong needs to aim for.