Russia and Vietnam will develop cooperation in the field of shipbuilding.

This online conference is one of the stages of preparation for the NEVA exhibition, which will be held in St. Petersburg on September 21-24 this year.

Opening the conference, the moderator - Professor Konstantin Rozhdestvensky - Director of the Faculty of International Cooperation, St. Petersburg State University of Marine Engineering reiterated that Vietnam is a "maritime" country, with a coastline of more than 3,000 km and ranks 6th in the world in terms of shipbuilding capacity. And for that reason, maintaining and developing the relationship between the two states in the field of maritime transport and shipbuilding is extremely important and profitable.

Russian shipbuilding industry has made remarkable progress. Photo: Sputnik

Russia's shipbuilding power and the possibility of cooperation with Vietnam

In his speech, Head of the Department for Shipbuilding Industry and Marine Technology of the Russian Ministry of Industry and Trade Ilya Pomylev noted:

"Vietnam is one of the important partners of the Russian Federation in the Asia-Pacific region. In the context of the decline in world trade due to the pandemic, on the contrary, the trade turnover between Russia and Vietnam in 2020 increased by 15% and reached 5.7 billion USD. Ship exports from Russia to Vietnam increased by 48% (from 10 to 15 million USD), but imports decreased sharply - from 19 million USD to 277 thousand USD. The direction to promote further growth of bilateral trade is the export of non-resource products and extensive industrial cooperation. We see great opportunities in the field of civil shipbuilding".

There is still a misconception in the world that Russian shipbuilding is “honed” exclusively for the military, while the civilian sector is weak. This view is outdated. Ilya Pomylev proves this with figures and facts:

"The Russian shipbuilding market in 2020 increased in value by 67% to 230 billion rubles (nearly 3 billion 126 million USD). The total tonnage of delivered ships increased by 59%. More than 40% of the total value of built ships are icebreakers and large-tonnage ships. In particular, the construction of the 60 MW nuclear icebreaker "Arktika", the 25 MW diesel-electric icebreaker "Viktor Chernomyrdin" and the 114 thousand-ton tanker "Vladimir Monomakh" (Aframax type) has been completed. In addition, in the field of civil shipbuilding in Russia there are dry cargo ships, barges and specialized ships. Until 2030, promising areas will be the fleet of large-tonnage ships, fishing vessels and large-sized icebreakers. According to the plan of the Russian Ministry of Industry and Trade, by 2035 it is expected to build more than 1,000 ships all kinds".

According to Mr. Ilya Pomylev, Russian enterprises are ready to supply Vietnam with a “line” of civil river and sea vessels. There has been a positive experience in placing orders for shipbuilding in Vietnam. In 2015, the dredger Severnaya Dvina for Russia was launched at the Song Thu Shipyard.

There is also the issue of ships supporting the development of oil and gas fields on the Vietnamese continental shelf. The fleet of specialized ships of the Vietsovpetro Joint Venture is up to several dozen and is constantly being supplemented. This opens up opportunities for extensive cooperation between Russian and Vietnamese shipyards. In addition, one of the major bilateral projects in the field of maritime transport could be the development of a logistics corridor between the port of Azov (Southern Russia, Rostov region, one of the oldest seaports in Russia) and Hai Phong. The project also includes the establishment of a Vietnam-Russia industrial park in Quang Ninh province. The strategy for the development of ports for 2023-2024 has been developed and is being implemented. Representative of the Russian Ministry of Industry and Trade Ilya Pomylev affirmed that "we are always open to dialogue and ready to support the development of trade relations between Russia and Vietnam".

Guarantee support for shipbuilding enterprises

Mr. Duong Hoang Minh - Commercial Counselor of the Embassy of the Socialist Republic of Vietnam in the Russian Federation, spoke at the conference in Russian. In particular, he stated:

"Our two countries have cooperated since the Soviet era, but before that it was mainly military shipbuilding. In recent times, the two sides have made many efforts to develop cooperation in the field of civil shipbuilding. For example, the establishment of a Joint Working Group on Shipbuilding within the framework of the Intergovernmental Committee, continued transfer of Russian shipbuilding technology to Vietnam, and participation in specialized exhibitions such as VIETSHIP.

However, cooperation in civil shipbuilding is still not commensurate with the strategic nature of the relationship as well as the potential of both countries. After the Vietnam - EAEU FTA took effect, businesses have received more opportunities for wider exchanges. We hope that this conference will provide objective assessments of the cooperation situation in the field of shipbuilding and propose practical steps to promote it in the near future. We invite Russian and Vietnamese companies to participate more actively in the exhibitions of the two countries, visit each other more often to assess the current situation of the industry and cooperation opportunities. The Trade Representative and the Embassy of Vietnam are ready to support, coordinate and assist businessmen of the two countries in this field with great potential."

Illustration.

The speech of the Trade Representative of the Russian Federation in Vietnam Vyacheslav Kharinov was addressed to Russian businessmen and shipbuilders who are looking to approach Vietnamese partners, but do not know the current situation in Vietnam, often operating with hopelessly outdated ideas. He outlined the current state of the Vietnamese shipbuilding and shipping industry - an extremely important industry for the country, which needs to be considered accurately in its entirety.

"The maritime economy" is one of the most important drivers of the development of the entire national economy, said Vyacheslav Kharinov - A significant, if not the main, part of the cargo traffic is transported by sea, so the State actively supports the industry. The national strategy provides for the formation of three shipbuilding centers in the country: the North, the Central and the South. The proportion of local production is increasing, and the legal framework is being improved (including attracting foreign investors, developing specialized organizations). Vietnam has about 120 new building and repair facilities capable of building ships with a displacement of over 1,000 tons. The total production capacity is more than 2.6 million tons (displacement), but in reality it is currently operating at 50% of its capacity. The main domestic shipbuilding company is SBIC. In 2020, 70% of the company's output was new construction, 30% was repair. Some other companies also participated in this industry such as Vietnam National Shipping Lines, Petrovietnam. Hyundai Group is one of the largest foreign investors in Vietnam's shipbuilding sector.

According to Mr. Vyacheslav Kharinov, in order to “promote” Russian-Vietnamese cooperation in the field of civil shipbuilding, it is necessary to update the documents of the Working Group on this field, operating within the framework of the Intergovernmental Commission. In the latest Protocol of the Working Group in 2018, a number of new areas of mutual interest were noted. They need to be in line with the realities of 2021.

"These are scientific studies aimed at improving the operational and technical characteristics of ships and maritime equipment serving the development of the continental shelf; linking the design of high-speed transport and passenger ships; developing technology and production equipment for building and repairing ships; projects to modernize existing production facilities; and organizing cooperation in shipbuilding at Vietnamese and Russian shipyards for the benefit of the two countries," said Mr. Vyacheslav Kharinov.

From practical projects, according to the Russian trade representative, the production (or transfer) of prefabricated high-speed passenger ships to Vietnam to serve the coastal route to Phu Quoc Island or even "Phu Quoc - Sihanoukville (Cambodia)" is very suitable. Another direction is new ships with a large enough capacity to connect the Vietnamese mainland with the islands in the East Sea. The fleet currently operating on this route has limited seaworthiness and is in particular need of modernization.

Mr. Vyacheslav Kharinov noted: The Trade Delegation of the Russian Federation is in close contact with the Ministry of Industry and Trade of the Socialist Republic of Vietnam, ready to support shipbuilding enterprises and representatives of Russian water transport in finding partners in Vietnam. Not only potential customers of Russian products and technologies, but also contractors for Russian orders.

Old shipping routes are still relevant today.

Russian-Vietnamese cooperation in the field of river transport is no less important. Here we are talking about Vietnamese search and rescue patrol vessels and water police, capable of operating in crowded shallow waters, as well as passenger and cargo ships.

Photo illustration.

"There are inland waterways in southern Vietnam, which can lead to other Southeast Asian countries such as Cambodia, Laos, Thailand and even Myanmar. This is an attractive direction for both cargo transport and tourists, including Russian tourists,"Russian Trade Representative in Vietnam noted.

Revolving around the topic of river ships, another delegate of the conference, Chairman of the Russia-Vietnam Business Council, Chairman of the Board of Directors of the Azov Seaport Andrian Sinebok, also had an opinion.

"Vietnam is a country with a rapid economic growth rate. The shipbuilding and water transport market is developing very actively there. The inland waterway development program is being implemented. The share of inland waterway transport in the total volume of freight transport is currently 15.5%, passengers - only 1.9%. The growth rate of transport traffic until 2030 is 5.5% / year, of which goods - 1.4%. By 2030, the volume of water transport will reach 655 million tons of cargo, of which containers - 5.5 million TEU (20-foot containers), and 200 million passengers. River-sea traffic will reach 30 million tons. The total tonnage of Vietnam's cargo ships will be 30-33 million tons, of which the river fleet will be 1.5-2 million tons. Passenger ships will be calculated for 950 thousand seats", said Andrian Sinebok.

Accordingly, the demand for modern ships, both sea and river, will also increase. With its capacity and capability, Vietnam can hardly cope with that task, which requires attracting foreign capital. According to Andrian Sinebok, Russia must take advantage of new opportunities to consolidate its position in the Vietnamese market in both the field of shipbuilding and water transport.

The conference also discussed technology exchange in the field of shipbuilding, joint investment projects and personnel training.