Businesses hope Nghe An will soon improve logistics

Logistics is understood as the process of planning, applying and controlling the flow of goods from input to output through the port, including import and export freight transport, fleet management, warehousing, raw materials, order fulfillment, inventory management... However, in Nghe An for many years, this service has had shortcomings, not supporting business development. Therefore, removing this "bottleneck" is a policy that Nghe An province focuses on implementing.

Good traffic connection but fragmented logistics

An important meeting recently took place between the leaders of Nghe An province and the industries and infrastructure businesses as well as large logistics enterprises nationwide.

Many businesses believe that logistics services in Nghe An in general and transportation services in particular are not yet developed, causing disadvantages for businesses. For example, many businesses, especially FDI businesses, have a need to regularly export goods, directly from Nghe An to foreign countries. However, container shipping lines at Cua Lo port are not regular (3 trips per week), so most businesses choose Hai Phong port to export goods, especially textile and tea businesses. Only businesses that produce heavy goods such as white stone, cement, clinker, etc. choose Cua Lo port.

The loss for businesses when exporting goods from Nghe An to Hai Phong port is that the cost is much higher than from the northern provinces to Hai Phong port. Specifically: From Nghe An to Hai Phong is 403 USD/20 feet container, while from Bac Ninh to Hai Phong is only 179 USD, 224 USD lower, from Hanoi to Hai Phong is 201 USD, lower than Nghe An to Hai Phong 202 USD/container (20 feet).

Comparison table of transportation costs from provinces to Hai Phong. Graphics: Huu Quan

Mr. Nguyen Quoc Khanh, representative of Vietsun shipping company branch in Nghe An, said: Currently, the company is transporting goods through Cua Lo port to other ports at 400-500 containers per month, while goods to Hai Phong are 700-800 containers per month, almost twice as many as goods to Cua Lo port. In which, goods to Hai Phong port are mainly light goods, needing to go immediately. Cua Lo port has also reduced the cost compared to other ports by 200,000-800,000 VND/container, but due to the frequency of only 3 trips per week, many businesses choose Hai Phong port to export goods.

Production of elevator assembly screws in Nghi Phu Industrial Park, Vinh City. Photo: Chau Lan

One of the reasons why businesses choose Hai Phong port and accept higher costs than Cua Lo port is because of good logistics services, such as packaging, cargo handling and other warehousing services.

The problem is that if Cua Lo Port does well in logistics services, businesses will save a lot of transportation costs, reduce product prices, increase competitiveness and increase profits for businesses. Nghe An currently has 200 businesses participating in import and export activities, but the scale of the businesses is small and medium, and the business activities are small. The amount of goods is not abundant and there are no specific statistics to attract businesses in the logistics industry to "jump in".

Although Nghe An has Cua Lo International Port cluster including Cua Lo port, Cua Lo deep-water port, The Vissai specialized port, DKC petroleum port, Dong Hoi port, the total cargo throughput through the port each year reaches 6.3 million tons. Nghe An also has a synchronous road, air and waterway transport system that is considered well connected and currently agents such as Viet Nhat shipping line, Container Joint Stock Company, Viconship, Nacoship... and other units are trying to invest in vehicles, innovate management but still cannot meet the needs of businesses, especially businesses producing goods in the Industrial Park, which requires a very high level of professionalism in the production, distribution and business chain.

If logistics in Nghe An does not develop, it cannot be a midwife for businesses. Nghe An is determined to change the way it serves, taking care of businesses' worries. However, the key issue that businesses doing logistics need to know is the business, the volume of imported and exported goods. And the province needs to maximize incentives for businesses, to attract more investors to produce goods."

Colonel Bui Sy Tuan - Deputy General Director of Saigon Newport Corporation, the 22nd largest port in the world, specializing in exporting 50% of the country's container cargo, commented:

Colonel Bui Sy Tuan - Deputy General Director, Saigon Newport Corporation

Mr. Nguyen Chi Toan - Senior Marketing Director of VSIP in the North and Central regions said that through the survey, it was shown that many businesses do not export goods through Cua Lo port, logistics costs in Nghe An are high, so Nghe An also loses a lot of taxes and other profits from logistics.

From that inadequacy, Mr. Nguyen Chi Toan suggested: Nghe An needs to have policies and support for businesses when exporting and importing goods. Industrial park infrastructure investors as well as businesses hope Nghe An will support information on the volume of goods entering and leaving the province, how many trips and return trips to combine with logistics businesses when they invest, helping them have enough goods to go and return smoothly.

Logistics is an extremely important industry to ensure smooth business operations, especially manufacturing businesses. The involvement and interest of Nghe An province in logistics at this time is extremely important. Accordingly, Vice Chairman of the Provincial People's Committee Le Ngoc Hoa said that the province will establish a working group to more specifically grasp the needs of businesses and from there have policies to remove this important link. The provincial leaders also committed that Nghe An will create the best conditions for logistics businesses and infrastructure businesses to operate and support each other to develop together.

Nghe An currently has 21,000 hectares of industrial parks, an international seaport cluster, 9 small-scale logistics enterprises, and 2 container shipping lines.