The lack of its own shipping lines makes Vietnam’s exports dominated by foreign shipping lines, causing many difficulties for exporters.
At the Seminar with theme “Solutions to promote the logistics industry to take advantage of opportunities from EVFTA” on September 22, Mr. Ngo Chung Khanh, Deputy Director of the Multilateral Trade Policy Department (Ministry of Industry and Trade), said that after two years of implementing the Free Trade Agreement between Vietnam and the European Union, enterprises’ ability to take advantage of incentives from this agreement is increasing.
Exports to the EU market in 2021 will grow by about 14% and in the first 8 months of 2022 will grow by about 15%. According to Mr. Khanh, in 2021, the utilization rate of preferential C/O is about 14%, but by 2022, the utilization rate is “nearly 25%”.
However, Mr. Le Hoanh Khanh Nhut, General Director of Da Nang Rubber Joint Stock Company, shared: Logistics costs are a huge expense when exporting to the EU.
EVFTA opens up opportunities for Vietnamese exports. Photo: Hoang Ha
Vietnam’s lack of shipping lines causes Vietnamese exports to be dominated by foreign shipping lines, causing many difficulties for exporters.
“Especially in times like China’s blockade because of the Zero Covid-19 strategy, if we can’t maneuver empty containers, we won’t be able to proactively source ships, so we can’t control those costs,” said Mr. Nhut.
Therefore, the representative of Da Nang Rubber suggested that Vietnam also develop logistics centers at large ports to ensure the appropriate number of ships in and out. In addition, Vietnam should also invest in shipping lines to keep the initiative, thus mastering this game.
Acknowledging that it is very difficult to compete in logistics with foreign giants such as DKL or Maersk, Mr. Mai Tran Thuat, Director of Supply Chain Solutions, Bee Logistics Group frankly shared: “Temporarily we are agents, called working with major firms as subcontractors for them, to increase our presence for European businesses as well as increase jobs.”
Mr. Tran Thanh Hai, Deputy Director of the Import-Export Department (Ministry of Industry and Trade), said that the EU is one of Vietnam’s traditional markets. When Vietnam signed a free trade agreement with the EU, the volume of traded goods also increased a lot. In particular, there are items that have a large volume of transportation, such as textiles, footwear, or seafood.
“In order to bring these items to the EU area at a reasonable cost, ensuring time plays a very important role for logistics service businesses,” Mr. Hai commented.