Vietnam’s over-burdened shipping infrastructure is taking a big toll on freight operations, with the peak port authority estimating the industry loses US$2.4 billion a year because it can’t reach the country’s best docks.
Cai Mep International Terminal (CMIT), 50 kilometers southeast of Ho Chi Minh City, the nation’s commercial hub, provides deep-water access for larger vessels with capacity of 18,000 20-foot equivalent units (TEUs).
But shippers prefer to use the far smaller Cat Lai Port, which is closer to the manufacturing districts of Binh Duong, Ba Ria-Vung Tau, Dong Nai and Ho Chi Minh City itself.
Containers must be offloaded onto more compact vessels at sea or transshipped through larger Hong Kong and Singapore ports so they can access Cat Lai, which creates delivery delays and hikes costs. Shipping through Hong Kong can add 30% to the cost of a container.
“If goods can be shipped with large vessels, goods owners can save US$200-US300 per container compared with small vessels,” Vietnam Port Association secretary general Ho Kim Lan told VietnamNet Bridge.
The association says the estimated losses of US$2.4 billion a year are based solely on the industry’s inability to access CMIT, which is operating well below its capacity while congestion steadily builds at Cat Lai. There is no effective road or rail infrastructure linking CMIT to Ho Chi Minh City.