Efficient Logistics: A Key to Vietnam's Competitiveness
Vietnam has attained a strong record of economic growth and poverty reduction since the adoption of market-based economic reforms and pro-poor policies starting in the mid-1980s. Much of this achievement was driven by an untapped, rapidly-growing labor force and the enablement of greater labor participation in higher-productivity sectors of the economy. Yet, as Vietnam has restructured its economic activity towards manufacturing, more mechanized primary sector production and, increasingly, services, and as the labor force is projected to expand at a markedly lower rate than before, finding new sources of productivity improvements has become the key to sustaining economic growth going forward. Improvements in freight logistics can unlock productivity gains across the Vietnamese economy for years to come. The shippers and carriers that operate the supply chains that connect Vietnam to the global economy generally perceive that logistics costs in Vietnam—those incurred when moving, storing and inspecting goods—are more onerous than in peer economies like China, Malaysia and Thailand, even as they are also perceived to be more competitive than those in other developing Asian countries. While many factors may contribute to costly logistics, the main source of underperformance in Vietnam’s logistics sector appears to be the inventory-carrying implications of unreliable freight itineraries, unpredictable inspection and clearance procedures, and an uncertain planning, legal and regulatory framework. By making commerce more predictable, particularly for regional and inter-continental trade, more efficient logistics can lower the cost of doing business, boost competitiveness, attract investment and generate employment. In short, efficient logistics can become a driver of lasting growth. Directed at industry practitioners and policy makers alike, this report highlights five key initiatives to improve the reliability and cost-effectiveness of transportation and logistics in Vietnam’s domestic and international supply chains. These include: (i) modernizing the customs system more broadly to enable goods clearance in a consistently timely manner; (ii) enhancing regulatory transparency to minimize discretion in the regulation of commerce; (iii) promoting multimodal transport corridor planning; (iv) enhancing competition and professionalism in the trucking industry; and (v) deploying capacity more strategically at major gateways, particularly at Cai Map-Thi Vai.
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Efficient Logistics: A Key to Vietnam's Competitiveness
Vietnam has attained a strong record of economic growth and poverty reduction since the adoption of market-based economic reforms and pro-poor policies starting in the mid-1980s. Much of this achievement was driven by an untapped, rapidly-growing labor force and the enablement of greater labor participation in higher-productivity sectors of the economy. Yet, as Vietnam has restructured its economic activity towards manufacturing, more mechanized primary sector production and, increasingly, services, and as the labor force is projected to expand at a markedly lower rate than before, finding new sources of productivity improvements has become the key to sustaining economic growth going forward. Improvements in freight logistics can unlock productivity gains across the Vietnamese economy for years to come. The shippers and carriers that operate the supply chains that connect Vietnam to the global economy generally perceive that logistics costs in Vietnam—those incurred when moving, storing and inspecting goods—are more onerous than in peer economies like China, Malaysia and Thailand, even as they are also perceived to be more competitive than those in other developing Asian countries. While many factors may contribute to costly logistics, the main source of underperformance in Vietnam’s logistics sector appears to be the inventory-carrying implications of unreliable freight itineraries, unpredictable inspection and clearance procedures, and an uncertain planning, legal and regulatory framework. By making commerce more predictable, particularly for regional and inter-continental trade, more efficient logistics can lower the cost of doing business, boost competitiveness, attract investment and generate employment. In short, efficient logistics can become a driver of lasting growth. Directed at industry practitioners and policy makers alike, this report highlights five key initiatives to improve the reliability and cost-effectiveness of transportation and logistics in Vietnam’s domestic and international supply chains. These include: (i) modernizing the customs system more broadly to enable goods clearance in a consistently timely manner; (ii) enhancing regulatory transparency to minimize discretion in the regulation of commerce; (iii) promoting multimodal transport corridor planning; (iv) enhancing competition and professionalism in the trucking industry; and (v) deploying capacity more strategically at major gateways, particularly at Cai Map-Thi Vai.
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Efficient Logistics: A Key to Vietnam's Competitiveness

Efficient Logistics: A Key to Vietnam's Competitiveness

Efficient Logistics: A Key to Vietnam's Competitiveness
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Efficient Logistics: A Key to Vietnam's Competitiveness

Efficient Logistics: A Key to Vietnam's Competitiveness

Overview

Vietnam has attained a strong record of economic growth and poverty reduction since the adoption of market-based economic reforms and pro-poor policies starting in the mid-1980s. Much of this achievement was driven by an untapped, rapidly-growing labor force and the enablement of greater labor participation in higher-productivity sectors of the economy. Yet, as Vietnam has restructured its economic activity towards manufacturing, more mechanized primary sector production and, increasingly, services, and as the labor force is projected to expand at a markedly lower rate than before, finding new sources of productivity improvements has become the key to sustaining economic growth going forward. Improvements in freight logistics can unlock productivity gains across the Vietnamese economy for years to come. The shippers and carriers that operate the supply chains that connect Vietnam to the global economy generally perceive that logistics costs in Vietnam—those incurred when moving, storing and inspecting goods—are more onerous than in peer economies like China, Malaysia and Thailand, even as they are also perceived to be more competitive than those in other developing Asian countries. While many factors may contribute to costly logistics, the main source of underperformance in Vietnam’s logistics sector appears to be the inventory-carrying implications of unreliable freight itineraries, unpredictable inspection and clearance procedures, and an uncertain planning, legal and regulatory framework. By making commerce more predictable, particularly for regional and inter-continental trade, more efficient logistics can lower the cost of doing business, boost competitiveness, attract investment and generate employment. In short, efficient logistics can become a driver of lasting growth. Directed at industry practitioners and policy makers alike, this report highlights five key initiatives to improve the reliability and cost-effectiveness of transportation and logistics in Vietnam’s domestic and international supply chains. These include: (i) modernizing the customs system more broadly to enable goods clearance in a consistently timely manner; (ii) enhancing regulatory transparency to minimize discretion in the regulation of commerce; (iii) promoting multimodal transport corridor planning; (iv) enhancing competition and professionalism in the trucking industry; and (v) deploying capacity more strategically at major gateways, particularly at Cai Map-Thi Vai.

Product Details

ISBN-13: 9781464801037
Publisher: World Bank Publications
Publication date: 01/02/2014
Series: Directions in Development - Countries and Regions
Pages: 200
Product dimensions: 6.80(w) x 9.90(h) x 0.50(d)

Table of Contents

Foreword xi

Acknowledgements xiii

About the Authors xv

Abbreviations xvii

Overview 1

Chapter 1 Introduction 7

Objective and Scope 7

Approach and Methodology 8

Note 10

Chapter 2 Vietnam's Current Situation 11

Economic Overview 11

Status of Existing Infrastructure 23

Strategic Freight Corridors 49

Notes 63

References 65

Chapter 3 Freight Stakeholder Challenges and Opportunities 69

Marine Terminal Operators 69

Ocean Carriers 74

Logistics Service Providers 80

International BCOs 91

Domestic BCOs 108

Trucking Industry 110

Notes 111

Reference 112

Chapter 4 Issues Screening and List of Actionable Recommendations 113

Freight Logistics Challenges 113

Development of a Multicriteria Evaluation Matrix 119

Goals Assessment and Recommendations to Improve Performance 120

Institutional Mechanisms to Support Logistics Policy Making 143

Notes 144

References 145

Appendix A Supporting Calculations 147

Appendix B Overweight Container Audit Process 159

Miniature Concept of Operations for Automated Weight Auditing and Fine Assessment 159

Note 160

Appendix C Entities Interviewed 161

International and Domestic Beneficial Cargo Owners: 27 161

Factories: 4 161

Logistics Service Providers: 11 161

Ocean Carriers: 5 161

Marine Terminal Operators: 15 162

Trucking Companies: 4 162

Trade Associations: 4 162

Government Entities: 4 162

Appendix D Methodology for Calculating the Cost of Congestion on the Vietnamese Economy 163

References 166

Appendix E Customs Flow Charts 167

Appendix F Components of Successful Public-Private Partnerships 171

Reference 173

Appendix G Organizational Structure of the Ministry of Transport of Vietnam 175

Glossary 179

Boxes

3.1 CenterPoint Intermodal Center, Ellwood, Illinois 87

4.1 Ports of Los Angeles and Long Beach Clean Truck Program 136

4.2 Global Logistic Properties Road Porte: China Test 138

F.1 Florida State Department of Transportation PPP for I-595 172

F.2 Structuring Successful Public Private Partnerships 172

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