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DEVELOPING LOGISTICS SERVICE IN VIETNAM

Vietnam’s logistics services – freight forwarding, transportation, and inventory services – began to develop in the 1990s. Logistics has now become an important economic sector in Vietnam. In the next decade Vietnam could reach an export-import turnover of 200 billion USD per year.

developing logistics service in vietnam

Vietnam earns US$22 billion a year from logistics services. The sector’s annual growth rate has been 16 to 20% in recent years. According to World Bank rankings, Vietnam ranks 64th out of 160 countries in logistics development and fourth in ASEAN after Singapore, Malaysia, and Thailand.

Logistics is one of Vietnam’s fastest growing and most stable services. Recent statistics from the Vietnam Logistics Association show that more than 1,300 logistics enterprises are now operating in Vietnam, including foreign-invested firms.

Most logistics service providers in Vietnam are small or medium-sized enterprises. Major firms like Transimex Saigon Corporation, Sai Gon Newport Corporation, Gemadept Corporation, and Transport and Chartering Corporation (VIETFRACHT) specialize in freight forwarding, loading, and uploading mainly in Ho Chi Minh City and Hanoi. There are 25 multinational enterprises operating in these areas. The rest are domestic small and medium-size enterprises and mainly work for international companies.

Logistics service providers in Vietnam have set up business relations with the US, the EU, ASEAN, Japan, China, and the Republic of Korea. In recent years, logistics has played an increasingly important role in economic development and international economic integration.

Phuong Lan, General Director of the Amerasian Shipping Logistics Corporation (ASL), said “Logistics is a support pision of the import and exports sector. When an economy grows, with an increasing volume of imports and exports, the workload of the logistics industry will also rise. Most logistics companies in Vietnam are small or medium-sized enterprises. But since Vietnam joined the WTO, the majority of Vietnamese logistic enterprises, which are mostly young, dynamic, and quickly adaptable companies, have grown.”

According to the Vietnam Maritime Administration, shipping is the most important area of logistics. But Vietnamese enterprises handle just 18% of the total import/export volume. The rest is done by foreign businesses.

Tran Thanh Hai, deputy head of the Import-Export Department of the Ministry of Industry and Trade, said Vietnam is poised for a logistics breakthrough.

“First, we need to improve the legal framework in line with the state management mechanism and adopt policies that support the industry’s growth. Second, it’s important to develop transportation infrastructure – bridges, roads, railway stations, ports, warehouses, and logistics centers,” Hai emphasized.

The government recently approved an action plan to enhance the competitiveness and growth of logistics services in Vietnam by 2025.

Source: VOV

http://customsnews.vn

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BUSINESSES LOOKING FORWARD FOR CUSTOMS CLEARANCE PROCEDURES TO BE MORE OPEN

VCN- Although the customs sector has achieved many results in reforming procedures and the spirit of service of customs officials and employees are recognized by the business community, appreciated, but still entangled in the process of customs clearance of goods related ministries that businesses want to be resolved thoroughly.

 

businesses looking forward for customs clearance procedures to be more open
Customs supervision at the warehouses (Yen Phong Industrial Zone – Bac Ninh). Photo: Thu Trang.

Increased coordination

Resolution No. 19-2017/NQ-CP by the Government on continuing to implement the main tasks and solutions to improve the business environment, enhance national competitiveness in 2017, orientation to 2020 requires to shorten the time for carrying out customs clearance of goods across borders to 70 hours for export goods, 90 hours for import goods.

However, according to the Vietnam Logistics Association (VLA) statistics in 2016, the time to clear export procedures is still high, up to 108 hours and 138 hours for imported goods. Time is still high obviously not entirely in the Customs sector, because customs clearance time for a customs declaration/shipment at customs only accounts for about 28% of customs clearance time and not exceed 1 business day. The remaining time belongs to enterprises and related agencies, in which specialized management agencies account for 72% of goods clearance time.

In this regard, Mr. Nguyen Tuong, Deputy Secretary General of the VLA, said that to reduce the clearance time, the improvement of specialized inspection procedures is a key issue, otherwise the efforts of the Customs will be heavily affected. A trade expert also said that in the specialized inspection, there are agencies, ministries and industries also “threaten” the businesses by issuing the long list of procedures that affect customs procedures.

In the report “Assessing the reform of customs procedures: the satisfaction of enterprises in 2016”, conducted by Vietnam Chamber of Commerce and Industry (VCCI), some enterprises said that the inspection issue remains too many overlapping legal documents, there is no close coordination between the customs and specialized management agencies, many licenses etc. Therefore, many businesses reflect the urgent matter such as, the goods being inspected takes time, cost when the products purchased by enterprises have to carry a quantity for inspection, sampling, the remaining goods are not enough supply under the contract. Or some companies said that the information required registration is unclear, causing companies to take time to re-disclose etc. These are the long-standing shortcomings of enterprises for specialized testing that require the agency to sit back and work together more closely.

Increase service

“Orientations for reforming administrative procedures of the Customs sector are on the right track, but there are still some documents and regulations related to customs clearance of goods due to lack of full participation of enterprises, so leaving some regulations that are not close to reality, leading to negative, causing trouble for businesses”, said Mr. Dang The Lung, General Secretary of Hai An District Association of Enterprises (Hai Phong).

Representatives of an import-export construction materials company in Nghe An said that although the customs clearance has applied electronic declaration, but at peak time, the system became overloaded, resulting in difficulties. In spite of this, the General Department of Customs has made a lot of directions on administrative procedure reform, but at the level of local departments and direct implementers, there are still some difficulties, particularly the attitude of the civil servants toward enterprises, even some of them do not consider enterprises as partners.

As the above difficulties, Mr. Phan Thong, General Secretary of the Vietnam Shippers’ Association, said that, besides the close coordination among branches, sectors and customs, there should be a strict monitoring mechanism, enhance capacity, level and awareness of cadres and civil servants of the whole industry. He also recommends to increase the compensation for customs officers because they have a lot of work, have to work overnight, even in the holidays like Tet holidays.

Along with the above issues, Ms. Dang Thi Binh An, Chairman of the Board member of the C&A Tax Consulting Co., said that the handling of complaints of enterprises should be improved, there should be separation to check, increased transparency and objectivity. Answering the written answers to businesses should be quicker and more frequent.

It can be seen that the efforts of the customs sector need to be further strengthened to meet the needs and requirements of enterprises, so that enterprises are the real partners and objects to serve. Of course, with the participation of the authorities, the political will of the Customs sector, there is a need to change the businesses’ operation with transparency and records, papers are clear so that ready to stand up to fight for misconduct when carrying out administrative procedures.

By Hương Dịu/ Huu Tuc

Source: http://customsnews.vn/