TPP, other FTAs put pressure on Vietnam port expenses

“Vietnam must do more to make its cargo operations more competitive with its regional rivals.” Vietnam’s logistics costs, at 25% of its GDP, are higher than those of regional competitors. Most of Vietnam’s international trade is conducted through the Cai Mep cluster of terminals near the southern metropolis of HCM City.

The transport ministry has introduced minimum guaranteed port tariffs – so-called floor rates – to help recoup some of its heavy investment in cargo terminal infrastructure and these floor rates have discouraged some lines from using Vietnam’s terminals.

“Port dues are very expensive by regional standards and we have tried to explain to the government that, far from losing revenue by lowering tariffs, if you reduce port dues you attract more shipping lines and your income goes up,” Robert Hambleton, general director of Cai Mep International Terminal, said.

“Vietnam must do more to make its cargo operations more competitive with its regional rivals,” Hambleton said.

Figures released by Maersk Line last year indicated that Vietnam’s logistics costs, at 25 percent of its GDP, are higher than those of regional competitors like China, where they total 18 percent of GDP.

Most of Vietnam’s international trade is conducted through the Cai Mep cluster of terminals near the southern metropolis of Ho Chi Minh City.

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Journal of Commerce, Oct 2, 2015

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