Solving the problem of digital transformation of logistics in the Capital Region

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Successful urban logistics models require technological support. Photo: TL

Applying integrated logistics linking the development of the Capital Region

With a total area of more than 24,300 km2, connected by a convenient transportation infrastructure network, the Capital Region includes 10 provinces and centrally run cities: Hanoi, Hai Duong, Hung Yen, Vinh Phuc, Bac Ninh, Ha Nam, Hoa Binh, Phu Tho, Bac Giang, Thai Nguyen are determined to become large integrated economic regions of Vietnam. In 2022, the economic growth of provinces and cities in the Capital Region will reach a level higher than the national average, including 2 provinces in the top 5 provinces and cities with the highest GRDP growth rate in the country. The provinces and cities of the Capital Region are making an important contribution to growth, trade development, and the country's trade balance surplus.

This is a premise and also an important condition to promote the development of logistics in the Region and connectivity within the Region and outside the Region.

Speaking at the conference "Promoting Logistics and Linking the Development of the Capital Region", Director of the Hanoi Department of Science and Technology Nguyen Hong Son, the Capital Region is determined to become a large integrated economic region of Vietnam. This is a premise and also an important condition to promote the development of logistics in the Region and connectivity within the Region and outside the Region. Hanoi City prioritizes the development of high-tech industrial production in high-value-added services such as finance, banking, tourism, logistics... This is considered a spearhead in the development strategy service industry, trade, and import and export of goods.

Assessing Hanoi's logistics situation, Mr. Nguyen The Hiep, Deputy Director of the Hanoi Department of Industry and Trade, said that Hanoi logistics businesses currently meet 25% of domestic demand and 18% of total goods volume of import and export, the rest is done by foreign-invested enterprises. Specifically, Hanoi has about 25,000 businesses operating logistics with different scales, levels, types, and industries of logistics services; About 400 businesses are using nearly 100 hectares of land to rent warehouses and storage yards for products, goods, and raw materials waiting for supply, distribution, and consumption; with sizes ranging from warehouses and yards with the smallest area of 60m2 to warehouses and yards with the largest area of 63,014m2.

However, these warehouses and yards are very small, fragmented, and scattered across districts and towns, lacking cohesion and forming spontaneously. Therefore, the scale of investment in these warehouses and yards is simple; Most of them are leveled flat floors and warehouses use steel frame assembly structures with corrugated iron roofs; A few warehouses and yards have specialized cold storage to store frozen food.

“Promoting increased cooperation between logistics businesses, businesses using logistics services in the area and throughout the country, with international businesses and organizations. Encourage and attract major logistics service providers in the world and domestic logistics businesses to set up headquarters, branches, and transaction offices in the region. Developing high-quality human resources, operating professionally in the field of logistics to be ready to adapt to the process of international economic integration", Deputy Director of Hanoi Department of Industry and Trade proposed.

Logistics infrastructure is the biggest problem

At an expert perspective, Dr. Trinh Thi Thanh Thuy, former Deputy Director of the Institute for Industry and Trade Strategy and Policy Research (Ministry of Industry and Trade), said that Implementing digital transformation and green transformation in the field of logistics in the capital region is inevitable. In the context of developing a green economy, and circular economy and implementing FTA commitments and other related international commitments, digital transformation of the logistics sector is required at all stages of the supply chain time with dual transformation in industrial production, agriculture, and trade, especially in e-commerce at both state and business management levels.

Drawing lessons from practical urban logistics models in the city of Regensburg (Germany), Spain or Bristol (UK), Dr. Le Thu Huyen, University of Transport and Communications affirmed that successful urban logistics models all require technological support. Accordingly, logistics infrastructure is the biggest problem for the Capital Region, long-distance transport connections depend on roads, and multi-modal connections are still low. In the context of rapidly increasing demand for transportation and logistics of goods, the explosive development of e-commerce, lack of connected infrastructure, lack of technology, fragmented facilities, and legal institutions have become a "bottleneck" for regional logistics services.

Therefore, Dr. Le Thu Huyen proposed to develop a focal point and logistics center model to serve goods distribution, clearly separating long-distance and regional goods needs. This solution is based on an urban logistics model that integrates application technology and information management through a shared database, such as a transportation and logistics exchange. "Scientific models of integrating logistics and urban logistics can be applied," she proposed.

According to economic experts, to promote the development of logistics, Hanoi needs to set a goal of developing and supporting logistics activities to improve the competitiveness of manufacturing and commercial enterprises, forming a modern logistics system and increasingly contributing to the city's GRDP.

At the same time, developing logistics infrastructure in sync with transportation infrastructure and civilized and modern trade-service infrastructure; Meeting the needs of import-export, transshipment, and domestic goods circulation; making Hanoi an important logistics hub for the region, the country, and the region. In addition, we need to promote logistics service businesses to innovate and create, providing logistics service chains at level 3, and level 4, moving towards level 5, electronic logistics on the basis of e-commerce development. Modern, efficient, and professional supply chain management and operations.