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Loading and unloading of import and export goods at Tan Cang Cat Lai

Bottlenecks that need to be removed

On December 2, 2024, the Vietnam Logistics Forum 2024 with the theme "Free Trade Zone - Breakthrough Solutions to Promote Logistics Growth" was organized by the Ministry of Industry and Trade in coordination with the People's Committee of Ba Ria - Vung Tau province, Prime Minister Pham Minh Chinh attended and spoke at the Forum.

Assessing the role of logistics, Minister of Industry and Trade Nguyen Hong Dien said that logistics is a service industry that is considered the "blood vessels" of the economy, playing an important role in connecting and supporting businesses and production facilities to reduce costs, reduce product prices, improve competitiveness, and promote socio-economic development.

Vietnam is a country located in a dynamic development region of the world, where the flow of goods is concentrated and strongly exchanged and the economy has a large openness (over 200%), with 17 Free Trade Agreements signed and implemented with nearly 70 countries and territories; Import-export turnover and e-commerce always grow at double digits, Vietnam is considered one of the markets with great potential and conditions for developing logistics services.

In 2024, Vietnam is evaluated and ranked by international organizations in the Top 10 emerging logistics markets; Top 4 in the world in the Logistics Opportunity Index and Top 43 in the Logistics Efficiency Index.

According to the report of the Ministry of Industry and Trade, the highlight of the logistics industry in 2024 is that the logistics infrastructure system continues to receive investment attention, strongly developing in a modern and safe direction, many projects meet international quality standards, the transportation network has connected to all regions and areas in the country, helping to reduce logistics costs and delivery times.

Many new policies have been issued, procedures have been adjusted to facilitate businesses; Information, propaganda and research activities, promotion and international cooperation on logistics have been taking place vigorously and widely at both central and local levels.

However, in addition to the achieved results, the development of Vietnam's logistics service industry has not been commensurate with the country's potential and advantages; logistics costs are still high, competitiveness is low; the shortage of human resources, especially high-quality human resources and lack of infrastructure connectivity are major "bottlenecks" that have hindered the development of logistics services in recent times.

In addition, geopolitical changes and new business trends (such as supply chain shifts, cross-border e-commerce, green and sustainable development standards) along with increasingly fierce strategic competition between major countries have also posed many new challenges to the development of the economy in general and logistics services in particular.

At the Forum, delegates proposed promoting the formation of free trade zones, international transit ports, building a fleet of container ships, and a fleet of specialized cargo aircraft.

At the same time, promoting international cooperation, building strong Vietnamese logistics enterprises, strongly developing transport infrastructure, warehouses, innovating technology, training and improving human resources in the logistics industry, developing public-private partnership models in the logistics sector, perfecting legal frameworks, and having policies to encourage foreigners to develop Vietnamese logistics such as tax policies, visas for foreigners, etc.

Increase growth rate to 20%

Speaking at the Forum, Prime Minister Pham Minh Chinh emphasized that in the coming time, with the integration trend, international trade will increasingly develop; on the other hand, the world has to face many national, comprehensive, global issues that no single country can solve.

In that context, logistics services play an increasingly important role, making practical contributions to the country's development and integration, participating in solving global issues.

Prime Minister Pham Minh Chinh gave a speech at the Forum. Photo: Nhat Bac

The Prime Minister emphasized that the development of the logistics industry must follow new trends such as: digital transformation, green transformation, circular economic development, sharing economy, knowledge economy; in the spirit of "resources originating from thinking and vision, motivation originating from innovation and creativity, strength originating from people and businesses", "creativity to fly high, innovation to reach far, integration to develop".

The Prime Minister clearly stated 3 goals for the development of the logistics industry, contributing to the major goal of national development: reducing logistics costs compared to Vietnam's GDP from 18% to 15% in 2025; increasing the proportion of Vietnam's logistics industry in the GDP scale from 10% to 15% and striving to reach 20%; at the same time, increasing the proportion of Vietnam's logistics industry compared to the scale of the global logistics industry from 0.4% to 0.5% and striving to reach 0.6%; increase the growth rate of Vietnam's logistics industry from the current 14%, 15% to 20% per year.

To achieve the above 3 goals, the Prime Minister requested the implementation of 7 solutions to develop the logistics industry.

First, further raise awareness of the position, role, and importance of the logistics industry and Vietnam's position in the center of the Asia-Pacific region to exploit and maximize the potential differences, outstanding opportunities, and competitive advantages in the world logistics chain.

Second, create institutional breakthroughs in an open direction to develop the industry to its full potential, with the viewpoint that "institutions are the knot of knots", "breakthroughs of breakthroughs".

Third, build a modern, smooth logistics infrastructure to reduce costs, increase product competitiveness, especially developing the aviation, maritime, and high-speed railway industries.

Fourth, build smart governance and train high-quality human resources for the logistics industry.

Fifth, promote integration, logistics diplomacy and modernize the domestic logistics industry.

Sixth, build and develop a free trade nation, while effectively managing, firmly protecting independence, sovereignty, unity and territorial integrity, maintaining a peaceful, friendly, cooperative and developing environment.

Seventh, closely connect modes of transport (aviation, maritime, rail, road and inland waterways) and connect with international transport, with free trade zones in the world.

The Prime Minister requested that on the basis of assigned functions, tasks and powers, agencies and localities actively and proactively deploy solutions according to the 7 solutions and breakthroughs mentioned above. In which, the Ministry of Industry and Trade presides over, along with ministries and branches, build a strategy for developing the logistics industry, a project for developing a free trade nation, and developing free trade zones at the border.

The growth rate of Vietnam's logistics industry in recent years has reached about 14-16%, with a scale of about 40-42 billion USD/year. According to the World Bank's ranking, Vietnam currently ranks 43rd out of 155 countries in logistics efficiency and is among the top 5 countries in ASEAN.

In the first 9 months of 2024, the whole country had nearly 6,500 newly registered enterprises in the logistics sector, with a total registered capital of VND 36,550 billion and a total registered number of nearly 28,900 employees, an increase of 13.5% in the number of enterprises, an increase of 18.3% in the number of employees, but a decrease of 11.3% in registered capital compared to the same period in 2023.