The domestic marine transport industry will face major challenges this year due to a sharply decreasing demand during the prolonged economic difficulty, industry insiders have said.

Nguyen Kim Chinh, director of the Tan Binh Shipping Co, said information indicated that China, Vietnam's largest container and spare part transport market, will experience a sharp drop in iron ore and coal reserves. At the same time, the US and the EU were not expected to increase imports of Chinese goods.

These combined factors will put pressure on the container and spare part transport market this year, Chinh said.

The liquid transport market, mainly oil products, is also forecast to face difficulties as most world economies continue to struggle and will have to tighten their belts.

In the domestic market, oil imports will fall thanks to the supply from the Dung Quat Oil Refinery, which can currently meet 30 percent of the country's demand for oil products.

Domestic demands for imported machines, equipment and materials are not expected to surge in line with the Government targets of 6.1 percent growth and single-digit inflation for the year.

Shipping fees are expected to fall as firms cut their fees to remain competitive with a growing number of shipping vessels calling into local ports.

Last year is considered a tough year for domestic shipping firms as many reported significant losses due to a sharp decrease in demand and fees.

To help marine transport firms overcome the difficulties, industry insiders have suggested the Ministry of Finance to exempt the value added tax on marine transport services among foreign ports.

However, they also urged shipping firms to restructure their fleets with a focus on investment in large-sized container ships and tankers to raise the competitiveness against foreign rivals.

The Vietnamese fleet currently accounts for only 6 percent of the domestic transport market share. More than 80 percent of Vietnamese imports and exports are transported by foreign shipping firms./.