Operating VR-SB ships, which can dock at any domestic ports, brings a lot of benefits to ship owners and enterprises thanks to the ships’ low building cost and logistic expenses (Photo: Vietnam+) Hanoi (VNA) - After five years of operating river-sea compatible ships as a mean of cargo shipping, not only government authorities but also logistic firms see this mean of transportation a righteous move that brings about huge benefits for enterprises.
However, the view is not shared among marine transporting vessels. They hold that the excessive booming of VR-SB ships are threatening the development of marine vessels, causing imbalance in transporting and erupting an unexpected war in freight price.
Explosive growth of VR-SB ships threatens traditional means of waterway transport
In 2014, the Ministry of Transport (MoT) opened two inshore shipping routes linking the northernmost coastal province of Quang Ninh with central Quang Binh province, and Quang Binh with the southern coastal province of Kien Giang.
The move aimed to capitalise on the nationwide river and canal network to use river-sea cargo vessels (VR-SB) to carry goods from rivers and canals in the mainland and then along the coast to reach destinations nationwide, a revolution in the country’s water transport industry.
Deputy Minister of Transport Nguyen Nhat said for short distances – about 400km and shorter – like between northern Hai Phong city and central Ha Tinh province, or between central Binh Thuan province and Ho Chi Minh City in the south, river-sea transport has advantages. It has helped handle a huge volume of cargo, especially oversize and overweight loads.
While road transport is under great pressure and rail transport is substandard, inshore shipping lines have been warmly welcomed by businesses, he noted.
Nhat explained that although the time needed to deliver goods on these routes is 1.5 – 3 times longer than by road, costs are 50 – 70 percent of using the roads.
He took the route from HCM City to central Quang Ngai province as an example. It costs 25 million VND (more than 1,000 USD) to transport one container by road, but the expense falls to only 6 million VND (nearly 260 USD) when using water transport.
According to statistics from Vietnam Register, 1,786 VR-SB ships have operated up to the end of May, 2019.
The freight volume transported on inshore shipping routes surges by 180 – 200 percent annually.
Insiders held that with the fast and constant growth of river-sea transport, the number of VR-SB vessels is forecast to rise sharply.
Vu Duc Ngo, Director of Vu Gia Tam Trade and Transport Company Limited, VR-SB vessel building cost is 10 to 15 percent lower than that of marine ships. Better still, the cost could even decrease by 30 to 40 percent when transforming old marine ships into VR-SB ones.
At its early stage, a VR-SB ship could only travel from Quang Binh province up to the North and vice versa. However, the route is now stretched to Ha Tien city and Phu Quoc district in Kien Giang province, making VR-SB ships a preferred choice by many enterprises.
Echoing the view, Truong Xuan Hoan, Director of Long Tan Sea Transport Company said VR-SB ships, which can handle both rivers and sea, allow enterprises to optimise their cargo shipping.
“In recent years, given rice exports to China decrease, many vessels have been on idle. 3000-DWT ships were struggling. The situation got even worse for those with Deadweight Tonnage of 2000 tonnes. Fortunately, we take a step ahead by transforming some marine vessels into VR-SB ones”, Hoa added.
Yet, logistic firms also raised their concern over the explosive growth of VR-SB ships. Indeed, the more marine ships are transformed into VR-SB ones, a war on freight price could rage on, placing ship owners under undue pressure.
Vietnam Maritime Association’s Deputy Director Bui Thien Thu said the development plan of the inland ship fleet in 2015-2020 only prioritised the development of VR-SB ships with a tonnage of up to 5,000 tonnes, but actually there are many newly built ships of capacities of over 20,000 tonnes.
The development of VR-SB ships is beyond the plan, he explained, while voicing his concern over safety of marine transport given the inferior personnel and technical infrastructure for operating the ships.
Technically, when a marine ship is transformed into VR-SB, its sailors are required to take additional training classes for a new certificate. However, many firms have skipped it as the courses are deemed costly and time-consuming.
On the other hand, many VR-SB ships lack an automatic identification system (AIS), causing difficulty in ship management, Thu said.
To ensure marine and river transport safety, Vietnam Maritime Association suggested the Ministry of Transport to consider suspending registration of VR-SB vessels with tonnage of over 5,000 tonnes in case of failing to meet legal regulations on safety and environmental protection./.
