Excessive Small Ports: Insufficient Big Ones

With a coastline of over 1,200km, provinces in the central part of Vietnam are vying with each other to construct seaports. The region is now home to some 20 seaports. However, the volume of goods transported through them is very limited. They are mainly collecting goods and then shipping to such large ports as Hai Phong port and Ho Chi Minh port for exporting. Therefore, economic effectiveness is not high and designed capacity is not reached.

 

In the first quarters of 2011, the total volume of goods through Cua Lo port (in Nghe An province), Vung Ang port (in Ha Tinh province), Hon La port (in Quang Binh province), Cua Viet port (in Quang Tri province) and Chan May port (in Thua Thien – Hue province) is just a little bit more than one third of that transported via Hai Phong port.

 

According to statistics, the volume of commodities transported via Vietnam’s seaports has witnessed a 10 – 12 percent increase during the last ten years. However, the disparity in the amount of goods among seaports is too high. Seaports in the North account for 25 – 30 percent of the total amount, while Southern ones make up 57 percent.

 

Experts believe that investments in construction of seaports by cities and provinces along the coast are not concentrated. They fail to make accurate assessment of the goods volume to be transported via their ports before implementing construction, which leads to many ports meeting only 20 – 30 percent of their designed capacity. Small ports with backward technologies will not be able to compete with stronger ones and losses or even bankruptcy are sure to follow.

 

Many experts advise that central provinces should focus on major ports. Ports which can be turned into deepwater ones like Quy Nhon port or Tien Sa port should be paid more attention to. Furthermore, there must be co-operation among seaports for mutual development.

 

Mr Nguyen Huu Tho, Director of MTV Limited Company, says that Chan May seaport’s coming into operation helps to accelerate socio-economic development of Thua Thien Hue and neighbouring localities. However, after seven years of operation, the port regularly faces obstacles caused by the massive illegal exploitation of lobsters on the waterway that ships travel in and out of the port. It is common to see ships entangled in lobster nets.

 

The orientation for Vietnam’s economic development is to focus on marine-based development. However, seaport planning during the past time poses many challenges. Lessons drawn from the planning of Van Phong seaport demonstrates that fact. So far, Van Phong is the only port in Vietnam planned to be an international entrepot port. After two years of implementation, the project has been temporarily stopped due to design changes; the initial designed capacity to serve ships of 6,000 – 9,000 TEU has been raised to 12,000 TEU. The client explains that this change is necessary in order to meet current demand. The initial design was out of date even compared to the domestic seaport system. As such, a major national project has become outdated after only two years of implementation. It is natural to ask if the planning lacks vision if planners failed to forecast development trends.

 

Similarly, in July 2007, Cua Viet port (in Quang Tri province) was handed over to Vinashin Group. Immediately, the Group planned to make an investment of over VND3,000 billion to upgrade the port into a large one. However, the flood in October 2007 decreased the water depth in Cua Viet from 4.2 m to 2.5 m, allowing only 500 ton or smaller ships to come into and out of the port. 

 

It is now impossible for seaports in Vietnam in general and in the central region in particular to receive container ships with loads of 4,000 TEU or more. They can receive those of 2,000 TEU only. As such, in order to export goods, we have so far gathered goods at Singaporean seaports and then used large ships. Every TEU, therefore, is now charged a US$400 higher fee. A simple calculation shows that it costs us billions of US dollars to export 4 million TEU via Singaporean seaports. This is not a small figure and more money will be wasted unless changes are made to the domestic seaport system.