Cat Lai ferry station in HCM City’s District 2 (Photo: VNA) Hanoi (VNS/VNA)- A lack of investment in inland waterways has stunted the development ofwater-borne shipping and made Vietnam’s logistics sector heavily dependent onmore expensive road transport.
With up to 2,360 rivers stretching a total of 42,000 kilometres, Vietnam boastshuge potential for a strong water-based transport system.
The newly opened river to sea transport routes are the realisation of some ofthis long-neglected potential, said Tran Bao Ngoc, Director of theTransportation Department under the Ministry of Transport.
After three years of operation starting in July 2014, vessels running on thoseroutes managed to deliver 47 million tonnes of cargo – far exceeding theGovernment’s target of 17.1 million tonnes in 2020 and 30.3 million tonnes in2030.
That achievement, however, was dwarfed by the colossal amount of goodstransported on Vietnam’s roads. A report by the General Statistics Office of Vietnamshowed that freight road transport reached 405.3 million tonnes in the firstseven months of this year despite the average cost for delivering a containervia the roadways being five to seven times higher than that of water-basedshipping.
Poor waterway infrastructure was the fatal weakness of the sector.
“Most of the vessels are old and outdated, infrastructure investment andmaintenance are neglected and the connection between the road, rail and seatransport sectors is yet to be planned properly to create a thorough logisticsnetwork,” said Inland Waterways Administration General Director Hoang HongGiang.
“All of this makes it impossible to call for more investment into the sector.”
Le Anh Son is Chairman of the board of the Vietnam National Shipping Lines(Vinalines), one the country’s leading corporations in sea ports and maritimetransport. He argued that any inland river routes must have proper planning andqualified ports.
“But planning always lags behind market demand,” he said.
A Government blueprint on restructuring the transport sector during the periodfrom 2016 to 2020 aims to cut the volume of cargo transported on roads down to54.4 percent from the current rate of more than 70 percent. The percentage ofcargo transported on inland waterways, on the other hand, will nearly doublefrom 18 percent to around 32.4 percent.
The attempt to reduce the dependence on road transport would require a hugeinvestment into inland waterways. However, the Government still spent more than70 percent of its total budget for transport infrastructure on roads, 15 percentfor railways, 7.6 percent for aviation and just 4.6 percent on maritimeprojects. Inland waterways received the smallest amount of funding – aroundjust two percent.
Vice Chairman of the National Assembly’s Ombudsman Committee Luu Binh Nhuongsaid this level of investment in inland waterways was “barely enough for thesector to survive,” let alone enough for it to develop and modernise.
“The Ministry of Transport should be the one to assess the market demand forwater-borne transport and help the Government and localities work out solutionsfor various problems,” he said. “Where should we call for private investment?Do we need to offer any kind of subsidy? What investment model should weencourage? Can we accept foreign investment?”
National Assembly deputy Pham Van Hoa urged the Government to create a legalframework and policies for investors in order to attract more capital into theunderdeveloped sector.
Le Anh Son, meanwhile, said the Government did not necessarily need to spendthe State budget to develop inland waterways. It could apply theBuild-Operate-Transfer (BOT) model that was very popular in road investmentover the last few years to mobilise money from private investors.-VNS/VNA
With up to 2,360 rivers stretching a total of 42,000 kilometres, Vietnam boastshuge potential for a strong water-based transport system.
The newly opened river to sea transport routes are the realisation of some ofthis long-neglected potential, said Tran Bao Ngoc, Director of theTransportation Department under the Ministry of Transport.
After three years of operation starting in July 2014, vessels running on thoseroutes managed to deliver 47 million tonnes of cargo – far exceeding theGovernment’s target of 17.1 million tonnes in 2020 and 30.3 million tonnes in2030.
That achievement, however, was dwarfed by the colossal amount of goodstransported on Vietnam’s roads. A report by the General Statistics Office of Vietnamshowed that freight road transport reached 405.3 million tonnes in the firstseven months of this year despite the average cost for delivering a containervia the roadways being five to seven times higher than that of water-basedshipping.
Poor waterway infrastructure was the fatal weakness of the sector.
“Most of the vessels are old and outdated, infrastructure investment andmaintenance are neglected and the connection between the road, rail and seatransport sectors is yet to be planned properly to create a thorough logisticsnetwork,” said Inland Waterways Administration General Director Hoang HongGiang.
“All of this makes it impossible to call for more investment into the sector.”
Le Anh Son is Chairman of the board of the Vietnam National Shipping Lines(Vinalines), one the country’s leading corporations in sea ports and maritimetransport. He argued that any inland river routes must have proper planning andqualified ports.
“But planning always lags behind market demand,” he said.
A Government blueprint on restructuring the transport sector during the periodfrom 2016 to 2020 aims to cut the volume of cargo transported on roads down to54.4 percent from the current rate of more than 70 percent. The percentage ofcargo transported on inland waterways, on the other hand, will nearly doublefrom 18 percent to around 32.4 percent.
The attempt to reduce the dependence on road transport would require a hugeinvestment into inland waterways. However, the Government still spent more than70 percent of its total budget for transport infrastructure on roads, 15 percentfor railways, 7.6 percent for aviation and just 4.6 percent on maritimeprojects. Inland waterways received the smallest amount of funding – aroundjust two percent.
Vice Chairman of the National Assembly’s Ombudsman Committee Luu Binh Nhuongsaid this level of investment in inland waterways was “barely enough for thesector to survive,” let alone enough for it to develop and modernise.
“The Ministry of Transport should be the one to assess the market demand forwater-borne transport and help the Government and localities work out solutionsfor various problems,” he said. “Where should we call for private investment?Do we need to offer any kind of subsidy? What investment model should weencourage? Can we accept foreign investment?”
National Assembly deputy Pham Van Hoa urged the Government to create a legalframework and policies for investors in order to attract more capital into theunderdeveloped sector.
Le Anh Son, meanwhile, said the Government did not necessarily need to spendthe State budget to develop inland waterways. It could apply theBuild-Operate-Transfer (BOT) model that was very popular in road investmentover the last few years to mobilise money from private investors.-VNS/VNA
VNA
