Logistics is an important service industry for Vietnam's socio-economic development. However, according to the Vietnam Logistics Services Business Association, Vietnam's logistics costs average 16.8%-17% of GDP, much higher than the world average of 10.6%. This reduces the competitiveness of Vietnamese goods and affects the business performance of businesses.
1. Causes
So what is the cause of high logistics costs? According to experts, there are many factors that cause this condition, such as:
- Logistics infrastructure still has many limitations, lacks synchronization and lack of connection, seaport planning is inadequate, there are no major ports or large regional and international logistics centers.
- The connection between modes of transport and water transport capacity is still low.Road transport is still the most popular mode of transport (accounting for 73% of goods transported in the first 9 months of 2023), followed by inland waterway transport with 21.6% of total goods volume. while sea transport only accounts for 5.2% of total output, rail and air transport are still very low at 0.2% and 0.01% respectively. This makes logistics costs high, reducing the competitiveness of Vietnamese goods.
- Domestic logistics businesses are mainly small businesses, with limited scale in both capital and human resources as well as international operating experience. Businesses do not have a connection between stages in the logistics supply chain and between logistics service businesses and import-export businesses.
- The business environment still has many shortcomings, administrative procedures are still complicated, lack of transparency and are not synchronized. Tax policies, fees, and service tariffs are not appropriate and competitive. Incentives and support for the logistics industry are lacking.
- Seaport transportation surcharges that foreign container ship owners are collecting from Vietnamese shippers, customs clearance time and professional inspection are also prolonged, causing increased costs.
To summarize, logistics costs in Vietnam are higher than the world average, which is a big challenge to the country's socio-economic development. To solve this problem, there needs to be consensus and efforts from both governments, businesses and stakeholders in investing, reforming and innovating the logistics service industry.
2. Solutions
To reduce logistics costs and improve efficiency in this service industry, experts propose a number of solutions, such as:
- Promote investment in developing logistics infrastructure, especially seaports, airports, railways, inland waterways and logistics centers. Build key ports, logistics areas, and industrial parks linked to logistics clusters. Strengthen links between modes of transport, prioritize the development of multimodal transport.
- Improve the capacity and quality of domestic logistics enterprises, promote linkages, cooperation, joint ventures, and partnerships with foreign enterprises. Strengthen training and fostering of human resources for the logistics industry, especially highly qualified human resources with management skills and use of information technology.
- Improve the business environment, simplify, make transparent and synchronize administrative procedures related to logistics. Adjust tax policies, fees, and service tariffs appropriately and competitively. Develop incentive and support regimes for the logistics industry, especially small and medium-sized enterprises.
- Take advantage of opportunities from free trade agreements, especially CPTPP and EVFTA, to expand markets and cooperate with international partners in the field of logistics. Enhance the application of information technology, digital transformation and creativity in logistics activities.
The above information is quoted by MDCT from official information sites. Hopefully through this article, you will grasp the situation of logistics costs in Vietnam.
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