Nghe An considers funding support for shipping lines and container transport businesses through Cua Lo port

Accordingly, if issued, shipping lines licensed to operate container transportation business according to regulations and performing cargo delivery or loading at Cua Lo port according to routes with a minimum frequency of 2 port calls per month will be supported with 200 million VND/port call.

Import and export of goods through Cua Lo port. Photo: Thanh Duy

As for businesses with goods transported by container through Cua Lo port with a minimum frequency of 2 times per month, it is proposed to support 600,000 VND/container for 20-foot containers and 1 million VND/container for 40-foot containers or more.

Shipping lines and businesses eligible to benefit from the policy have the right to choose to receive support funds monthly or one-time.

Currently, the People's Committee of Nghe An province is widely consulting on this draft policy from March 7, 2023 to April 7, 2023; moving towards completion and submission to the 18th Provincial People's Council, expected to be considered and issued at the July 2023 session on support policies for the period 2023 - 2026.

The policy is issued to effectively exploit the advantages of natural location, seaports, develop logistics services, attract investment in the Southeast Economic Zone and industrial parks in the province.

Attracting shipping lines to open container shipping routes and businesses with containerized goods is also expected to increase import and export turnover through Cua Lo port in the context of the total volume of goods through this port in the past two years showing a downward trend.

In 2021, it was 12.06 million tons (general cargo was 4.65 million tons; cement was 7.1 million tons; petroleum and gas was 0.31 million tons). In 2022, it was 11.96 million tons (general cargo was 5.6 million tons; cement was 6.33 million tons; petroleum and gas was 0.03 million tons). Meanwhile, the volume of imported and exported goods of enterprises in the province has had a fairly large growth rate in recent years.

According to the statistics compiled by the Department of Industry and Trade and the Customs Department of Nghe An, the total value of imported and exported goods of the province through Cua Lo port on the total export turnover is not high. In 2020, it was 487.5 million USD/more than 1.93 billion USD, in 2022 it was 469.1 million USD/more than 3.107 billion USD and in 2022 it was 494.4/more than 3.370 billion USD.

As we know, Resolution No. 36/2021/QH15 dated November 13, 2021 of the National Assembly on piloting a number of specific mechanisms and policies for the development of Nghe An province, which stipulates: "Every year, the central budget supplements the budget of Nghe An province with a target of not more than 70% of the increase in revenue from export and import activities of export and import goods compared to the estimate assigned by the Prime Minister (excluding value added tax on imported goods), but not exceeding the total increase in revenue from export and import activities compared to the revenue realized in the previous year and the central budget does not have a deficit to implement local infrastructure investment projects".

Thus, if this policy is issued, it can help boost import and export activities through Cua Lo port, thereby contributing to increasing import and export tax revenue, contributing to the provincial budget, thereby indirectly helping Nghe An have more resources from applying special mechanisms and policies issued by the National Assembly to implement local infrastructure investment projects; at the same time indirectly increasing service revenues at the port, creating jobs...

Cua Lo Port is a national general seaport, a regional hub (type I) belonging to the North Central region seaport group, planned to include the South Cua Lo wharf area (9 wharfs) and the North Cua Lo wharf area (25 wharfs), serving industrial production facilities in the Southeast economic zone, socio-economic development of Nghe An province, receiving a part of transit goods for the Lao People's Democratic Republic and the Northeast Kingdom of Thailand; has a general wharf, bulk cargo, container, liquid/gas cargo, passenger port, cruise ship associated with Cua Lo tourism.

Built in 1979, put into operation in 1985 with an initial scale of 4 wharves for ships of 10,000 to 25,000 tons. Along with the development of the Southeast economic zone, in 2010, the Prime Minister allowed Nghe An province to study the construction of wharves for ships of 30,000 to 50,000 tons in the North and South of Cua Lo, to attract investors in seaport business.

In the period 2010-2020, Nghe An province has successfully called for a number of investors to invest in seaport business. Up to now, Cua Lo Port has had 12 wharves put into operation (5 general wharves; 5 cement wharves; 2 petroleum wharves) initially meeting the needs of transporting goods and raw materials for investment, production and business activities of enterprises in the province and neighboring areas.

It is known that currently, Cua Lo Port has 2 shipping lines operating domestic container routes and international transit through Ho Chi Minh - Hai Phong - Cua Lo - Ho Chi Minh ports with a frequency of 2-3 trips/week.

From May 2022, there will be one shipping line operating direct international container routes from Cua Lo - Kolkata (India) - Chitagong (Bangladesh) with a limited frequency of 1 trip/week. However, in the whole year of 2022, there will only be 7 trips.

Through surveys and working with shipping companies, container shipping lines operating regular routes through Cua Lo port are suffering losses because their revenue cannot cover operating costs.

Therefore, to maintain a fixed container route through Cua Lo Port, Nghe An province must have an initial support policy to encourage shipping lines to load and unload goods at the port.