VIETNAM HAS GREAT POTENTIAL TO BECOME A REGIONAL AND WORLD LOGISTICS HUB

In recent years, logistics in Vietnam has grown significantly. At the reception of Prime Minister Pham Minh Chinh with President of the International Federation of Freight Forwarders Associations (FIATA) Turgut Erkeskin, the Prime Minister said that the average annual growth rate of Vietnam's logistics is from 14-16%. This plays an important role in bringing Vietnam's total import and export turnover in 2023 to nearly 700 billion USD.

In the first 6 months of 2024, the total import and export turnover is estimated at 370 billion USD, an increase of 15.7% over the same period in 2023, with a trade surplus of 11.63 billion USD; as an open economy, logistics plays an important role in Vietnam's economic development following the world trend.

Vietnam is developing a Strategy for the development of Vietnam's logistics services for the period 2025 - 2035, with a vision to 2045. In the coming time, the Vietnamese Government will consider establishing a steering agency for logistics services with a strong, capable, and competent professional apparatus to help the Government direct the development and promotion of this important field, meeting the practical requirements for the development of logistics services, ensuring that it is consistent with the trends and context of Vietnam's increasingly deep and broad international integration.

Prime Minister Pham Minh Chinh receives President of the International Federation of Freight Forwarders Associations (FIATA) Turgut Erkeskin - Photo: VGP/Nhat Bac

The Prime Minister hopes that FIATA will share more information, advice and support on digital transformation and green transformation, focusing on solutions for developing agricultural and industrial logistics, developing Vietnam's shipping fleet, economic, trade and transport corridors and technical support so that Vietnam can soon complete the National Strategy on Logistics Services Development in 2024.

Along with that, the Prime Minister asked FIATA to pay attention to supporting human resource development for Vietnam's logistics industry; expanding training programs and improving capacity for Vietnamese enterprises.

Before that sharing, President of the International Federation of Freight Forwarders Associations Turgut Erkeskin said that Vietnam has great potential to become a logistics center of the region and the world. The FIATA President said that Vietnam needs to mobilize all social resources to develop this economic sector.

Where does Vietnam's logistics industry stand in the world?
Logistics is a service chain activity from the pre-production stage until the goods reach the final consumer. This field is directly related to transportation, delivery, warehousing, administrative service procedures, consulting (customs, tax, insurance, etc.), import-export - trade, distribution channels, retail, etc.

Information from the Ministry of Finance shows that as of 2021, the number of transportation and logistics enterprises in Vietnam is currently 3,000, including all logistics enterprises operating on roads, railways, seaways, inland waterways, airways, etc. According to data from the General Statistics Office, most of Vietnam's logistics enterprises are small and micro-sized. The number of large-scale enterprises accounts for only 0.7%.

According to the Vietnam Logistics Services Association, Vietnam's logistics services have a relatively high growth rate of about 14 - 16%; the rate of enterprises outsourcing logistics services is about 60 - 70%, contributing about 4 - 5% of GDP (Song Ha, 2023).

According to the 2022 Country Logistics Capability Index Report by Agility - the world's leading provider of transportation and logistics services, Vietnam's logistics market is ranked 11th in the group of 50 emerging logistics markets globally. The compound annual growth rate (CAGR) for the period 2022 - 2027 is forecast to reach 5.5%.

According to the 2023 Country Logistics Capability Index Report by Agility, Vietnam is in the top 10 emerging logistics markets in the world and ranked 4th in Southeast Asia, after Malaysia, Indonesia and Thailand. In terms of domestic logistics opportunities, Vietnam is ranked 16th, up 1 place compared to 2022 with 5.02 points. In terms of international logistics opportunities, Vietnam is currently leading Southeast Asia, ranked 4th in the rankings with 6.03 points. Based on business conditions and technology readiness index, Vietnam is ranked 19th and 15th in the rankings, respectively.

Thus, although this service industry in Vietnam is still quite modest, compared to the general level of the world, Vietnam's logistics services have many conditions as well as room for development in the future.

Prime Minister Pham Minh Chinh said that Vietnam is focusing on developing strategic infrastructure, including logistics infrastructure, and training high-quality human resources.

(According to Cafebiz Newspaper)