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Le DuyHiep, Chairman of the Logistics Business Association (VLA)

Could you tell us what is the situation due to the lack of empty containers?

There is a shortage of empty containers of all kinds (including the 20-foot type, which is almost not lacking) due to social distancingin most countries around the world, especially the US and Europe - the large market of exports from Vietnam should slow the round-trip for containerised goods.

Through asurvey, up to 40% of enterprises said they had difficulty in delivering and receiving empty containers at container gathering places, when the owner came to receive but there were no containers. 43% said that thiswas as the reservation department with shipping lines rented empty containers in excess of the allowed quantity and 17% said the sales department did not have access to hire empty containers from shipping lines.

Not only exporters, but do logistics businesses also say that they are facing many difficulties in providing empty containers for customers?

This is the general situation as mentioned above. The corollary of this situation is the slow process for the delivery of exports to import customers, while it is currently the peak season of import-export. Enterprises are facing difficulties due to shipping lineslacking empty containers to deliver to exporters for packing.

The shortage of empty containers can last until March 2-3 in 2021, causing damage to the economy, as well as for businesses.

In addition to the increase in shipping charges due to alack of containers, according to enterprises, foreign container shipping lines also increase collection of THC surcharges and other surcharges, making it difficult for businesses to pay high freight, how do you comment on this situation?

Taking advantage of growing demand for shipping and customers cannot have many options, carriers are increasing freight rates. The shortage of empty containers can be solved sooner or later, but taking advantage of this shortage to increase shipping costs is unfair onimport-export businesses and logistics enterprises.

Currently, the transportation of import and export containers is almost done by foreign shipping lines. The Vietnamese carrier covers a small part of mainly Southeast Asia.

VLA said foreign container shipping lines are collecting unreasonable fees and charges from Vietnamese import-export enterprises, including cargo handling charges paid by shipping lines to ports. Since 2009, shipping lines have applied fees and surcharges with a steady increase over the years, regardless of loading and unloading prices at ports. Foreign shipping lines are charging high port handling charges (THC) but only return them to the port at 30-45% of the revenue from import and export customers. With more than10 million TEU of import and export goods going through Vietnamese seaports each year, shipping lines enjoy a huge difference in handling charges. Therefore, when increasing the service price at seaports, it is necessary to manage foreign container shipping lines not to increase the THC surcharge and other surcharges to cutnational logistics costs.

VLA believes that during the Covid-19 pandemic is still complexand disrupting the global supply chain, the increase in loading and unloading prices should have a roadmap at anappropriate time. Seaport service prices in general and seaport loading and unloading prices in particular must ensure the investment efficiency of port enterprises and national interests in the business process.

What recommendations does the VLA have to help businesses reduce their difficulties in the current period?

We urge shipping lines operating in Vietnam to have a certain share with customers, by increasing the amount of containers transported from other regions to Vietnam, while shortening turnaround times in ports. On the other hand, the authorities also help to increase customs clearance time to quickly free imports, thereby having more empty containers to serve export goods. In the long term, there should be enterprises (including Vietnamese and FDI enterprises) investing in large-scale production of empty containers to participate in the supply and stabilisation of this strategic product. (Currently in Vietnam there are almost no large-scale manufacturers of container goods).