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Transport infrastructure hampers development
Poor infrastructure and financing was handicapping the development of sea and air ports in Viet Nam, South Korean experts told their Vietnamese counterparts at a workshop in Ha Noi yesterday.
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| SP-SPA International Port in the southern province of Ba Ria-Vung Tau. The poor transport sector has been a major obstacle to Viet Nam's economic development. |
The Koreans were sharing their experiences and expertise under a knowledge-sharing programme supported by the Korean Ministry of Strategy and Finance, and the Korean Development Institute (KDI).
The workshop was supported by the Development Strategy Institute (DSI) of the Vietnamese Ministry of Planning and Investment.
DSI vice president Hoang Ngoc Phong said Viet Nam and South Korea recently pledged to strengthen political and economic co-operation.
He said that South Korea had much experience in dealing with problems faced by developing countries.
He said that about 22 topics were studied at the workshop, of which four are being carried out.
"All of them are key issues for Viet Nam's economic development," Phong said.
Yeong Heok Lee, a professor at Korea Aerospace University, said the transport sector had been a major obstacle to Viet Nam's economic development since Doi moi (Renewal) policy was introduced in 1986. He said it still remained a problem.
Viet Nam had 21 million people pass through its airports last year and the rate has been growing at nearly 16 per cent a year – one of the highest growth rates in world air transport.
"Although Viet Nam has 22 airports, their inefficient airport operation and low infrastructure hinder commercial activity and constrain airport capacity," said Professor Lee.
During 2001-10, air freight increased 16.2 per cent a year, but this was still considered small, he said.
"This is because the value of Vietnamese commodities is not high enough to warrant high air fares, as the high-tech products are not main commodities in trade yet," he said.
While hailing the Government's policy towards privatising air transport, Lee urged the Vietnamese Government to support small carriers to operate effectively and hasten the equitisation of Viet Nam Airlines to make it more competitive.
As the number of air passengers in Viet Nam is forecast to increase to between 34 million and 36 million by 2015, Lee suggested the Government increase investment in airport projects.
Beom-Jung Kim, the director general of port and logistics research at the Korean Maritime Institute, said cargo handled at Vietnamese ports had grown rapidly from 49 million tonnes in 1997 to 196.6 million tonnes in 2008 and an estimated 254 million tonnes in 2010.
However, poor infrastructure, poor financing, weak governance and low connectivity (transportation at ports and between ports and industrial zones) put them at a disadvantage because of the extra logistics costs involved.
Kim said Viet Nam's master plan for developing ports through to 2020 was mainly geared towards throughput demands and port expansions, but it lacked financing methods and the construction of hinterland transport.
He encouraged the Vietnamese Government to take the lead in preventing overlapping or reckless port development and to make the best use of limited resources.
"Areas with large population and industries should take priority," Kim said.
In addition, it was essential to build railways and roads linking ports and industrial complexes in the hinterland.
"Lastly, private capital and foreign direct investment (FDI) need to carry out port development instead of government resources, which were probably insufficient."
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