The huge potential for logistics service development in the southern key economic region

Mr. Le Duy Hiep, Chairman of Vietnam Logistics Business Association.

How do you assess the current status of logistics services in Ho Chi Minh City and other provinces in the southern key economic region?

Ho Chi Minh City is an important economic center of the country, where about 70% of Vietnam's logistics service providers are concentrated. The city has also established the City Logistics Association (HLA). Ho Chi Minh City is the locomotive of Vietnam's logistics service industry.

As for other provinces, namely Dong Nai, Ba Ria-Vung Tau, Binh Duong, Tay Ninh, Binh Phuoc, Long An and Tien Giang, the economy is very developed, but logistics service activities have not really met requirements; the connection performance in general needs improvement.

The potential for the development of logistics services is very significant. Especially, Ba Ria-Vung Tau has deep-water seaports and the potential to develop the logistics service center of the region.

It is said that a developed city needs three breakthroughs, namely institutions, infrastructure and human resources. In which, a breakthrough in transport infrastructure is the most important. However, the traffic infrastructure in Ho Chi Minh City and the Southern key economic region is still short of connectivity and synchronization, causing congestion in freight transport, increasing logistics costs for the enterprise. What do you think about this?

The city's logistics infrastructure has many difficulties, causing congestion in goods trade, which is obvious for a developed city like Ho Chi Minh City. In recent years, city leaders have made many efforts and solutions to overcome difficulties, but perhaps more drastic measures are needed for projects that have been delayed for many years, typically the project of ring road 3, projects/measures of traffic connection bottlenecks such as Cat Lai port - My Thuy area, SP-ITC port, Hiep Phuoc port, Soai Rap channel dredging.

In addition to infrastructure In addition, the city also needs to make further breakthroughs in soft infrastructure, which is to improve and apply information technology to traffic management, reduce administrative procedures, especially improve customs procedures to facilitate transportation of goods, consider further reducing the cost of seaport infrastructure, thereby reducing the city's logistics costs.

In addition to infrastructure, leaders of Ho Chi Minh City have pointed out that the big "bottleneck" that is hindering logistics development is human resource development. In your opinion, to overcome this limitation, what solutions should logistics enterprises and management agencies issue?

High-quality logistics human resources in the context of digital transformation, green logistics development are very necessary for economic development and logistics services of the city.

In order to solve the big bottleneck of human resources, the city management agencies need to work closely to support businesses in human resource training. It is necessary to assign the HLA Association to actively coordinate with VLA's VLI Institute as well as current logistics training institutions to train according to FIATA's programs, Aus4kill vocational training and organize study tours at centers in the region and in the world so that these are suitable for Ho Chi Minh City, especially focusing on the development of Urban Logistics.

The VLA Association is willing to cooperate with the city in training high-quality logistics human resources.

In order for logistics to become a spearhead service industry, enhancing its role as a focal point for domestic goods trade and connecting the domestic market with the world, Ho Chi Minh City as well as the provinces in the southern key economic region need to implement the following measures. What are the basic solutions, sir?

In my opinion, Ho Chi Minh City and the provinces need to develop an Action Plan or a strategy to develop the logistics service industry to 2030 specifically based on Decision 221/QD-TTg dated February 22, 2021 of the Prime Minister, amending and supplementing Decision 200/QD-TTg on approving action plans to improve competitiveness and develop logistics services in Vietnam by 2025 and approved local economic development plans. In which, measures to develop green logistics and smart logistics must be focused on and there must be a specific implementation plan.

It is necessary to quickly develop strong logistics service providers that can provide integrated services, such as 3PL and 4PL. The Department of Industry and Trade needs to act as a focal point to connect production, import and export enterprises with logistics service providers to cooperate in supporting logistics services and reducing logistics costs.

Cities and provinces need to set aside appropriate land funds and have specific incentive policies for enterprises to develop warehouses for goods handling, especially cold storage.

It is necessary to support capital and other incentives for enterprises to develop means of making goods. The development of inland ports and logistics centers helps to solve traffic congestion. And above all are to strengthen regional linkage cooperation as well as develop high-quality human resources in parallel with promoting digital transformation as the current urgent requirement.