Made in Vietnam: Emerging logistics giant isn’t slowing down post-TPP

Outlook uncertain

So, while some investments are in place to address infrastructure needs, does the Vietnamese government have the political will to align regulations with best practices? There certainly isn’t a shortage of headlines celebrating new development projects. Construction of Long Thanh Airport, north of Ho Chi Minh City, is expected to start in 2018 or 2019, at a cost US$5.4 billion, and upon completion, will have capacity for 25 million passengers and 1.2 billion tonnes of goods annually.

Some, however, are less enthusiastic about the country’s bureaucracy. Do Van Thuat, director of Long Quang Investment Co. Ltd., told Vietnam Net that it still “takes three to six months to import an auto into Vietnam and 15 to 20 days to finish customs clearance procedures.” Clearly, there is still red tape to cut.

On the forwarding side, DHL-GF’s Li was more optimistic. He predicted that “logistics demand in Vietnam will increase in order to support the growth in the manufacturing sector.” And while he admitted that transportation and warehousing infrastructure were underdeveloped, he saw that as an opportunity. “The Vietnamese government is also working on improving the road infrastructure and reducing customs procedures complexity to build a more conducive and attractive business environment in Vietnam.”

If the country can meet its infrastructure needs, the socioeconomics of the country – a young growing population, stable macroeconomic policy, and economic liberalization – suggest decades of increasing trade and job creation.

And what of the United States? That post-TPP story has yet to be written. “The USA as Vietnam’s most important trade partner will not lose importance,” said Dachser’s Seidel. But with the extra promise of the European free-trade agreement and the various Southeast Asian trade deals, Vietnam is hardly out of options for a brighter future in logistics.

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