Port Authority - New Superior Model

Speaking of this new model, Mr Nguyen Manh Ung, Deputy General Director of Portcoast, said, the port authority model aims at managing local ports uniformly and preventing unplanned and piecemeal development. The port authority does not replace the local government but, on the contrary, includes local authorities. The port authority only controls port business and related activities. These very advantages make the port authority the best choice for the seaport system development in Vietnam now.

 

Mr Nguyen Xuan Ky, Deputy General Director of Cai Mep International Terminal Co., Ltd. (CMIT), said: The port authority model has been applied successfully in many countries and has effectively helped local authorities regulate sea port activities. The port authority’s operations in the style of Landlord Ports feature: The State owns and invests in port and infrastructure construction (maritime channels and vessel traffic service (VTS), roads to ports, etc); private companies bid to operate ports and invest in on-port facilities. The port authority assumes responsibility for all traffic and technical infrastructure requirements in the port (on shore and under water) to ensure smooth activities of receiving ships and transporting cargo, connection with national traffic and technical networks; and all related environment issues.

 

He cited that port authorities in Germany and the Netherlands work very effectively in State management and business management, bring in huge profits for port operators, create jobs and implement one-stop shop mechanisms in administrative procedures. In Mumbai (Bombay) City, India, the city’s port authority provides a floor price for all ports which are allowed to compete in technology and equipment, not price. Besides, the Bombay Port Authority monitors the design capacity of every port to enforce specific remedies like high taxes on excess design capacity, or transfer of excess cargo to ports which are not at full capacity. In China, the Guangdong Port Authority has forced shipping companies to focus cargo on a new transhipment port in this province. This helps keep order and regulate the flow of goods in a more reasonable way. These examples show that Vietnamese ports are indeed in need of a port authority to gather the power of ports, and allocate cargo flows reasonably, based on their functions, to compete with regional and international ports. Especially, ports will have more reasonable prices than now.

 

Mr Ho Kim Lan, General Secretary of the Vietnam Seaports Association (VPA), said: The weakness of Vietnamese seaports is piecemeal and fragmented planning. Seaport management in Vietnam has so far been quite different from most countries in the world, resulting in fragmented and irrational investment and exploitation. To eliminate this and effectively coordinate seaport projects and infrastructure networks connecting ports, it is necessary to have a State regulatory role, through the mechanism of the port authority. Accordingly, it is necessary to have a roadmap of a port authority mechanism under international practices where there is the involvement of State authorities from the central to local levels and port operating enterprises.

 

Before the urgent need for the formation of a nerve centre in charge of managing all port activities, the Government has allowed the Vietnam Maritime Administration to pilot the port authority model. The administration is urgently studying the mode of operations of this model and will start the pilot with Cai Mep - Thi Vai port complex (Ba Ria - Vung Tau province) and two key ports, namely Lach Huyen Port (Hai Phong City) and Van Phong Port (Khanh Hoa province). Then, it will be applied on a wider scale to suitable ports in order to gradually complete the legal foundation, facilitate port development investment and commercial operation. This can be seen as an important turning point to make Vietnam's seaports integrate more deeply into the world, making Vietnam a major international seaport centre, and raising Vietnam’s seaport revenue.