Illustrative photo. (Source: VNA)The country enjoyed robust trade last year despite COVID-19, with high exportvalue on the back of orders from the US.
Total foreign trade was estimated at 543.9 billion USD, a year-on-year increaseof 5.1 percent, with the country posting a trade surplus of 19.1 billion USD,its highest since 2016.
According to the Viet Dragon Securities Corporation, the volume of goodshandled at local ports picked up after the second quarter last year, with thepandemic encouraging many multinational corporations (MNCs) to shift productionto Vietnam. It said this trend will continue as Vietnam integrates more deeplyvia free trade agreements (FTAs).
Market researcher Fitch Solutions has forecast that Vietnam’s trade revenue willgrow by an average of 11 percent each year during the 2021-2024 period, sparkedby better trade relations through FTAs such as the EU-Vietnam FTA (EVFTA) andthe Regional Comprehensive Economic Partnership (RCEP).
The country is developing its logistics infrastructure, which has beendescribed as an important factor amid the post-pandemic reshoring of globalsupply chains.
Along with various road construction projects, the development of deep-waterports has been paid due regard, such as the Gemalink Port at the Cai Mep - ThiVai International Port (to be operational in 2021), and the third and fourthwharves at Lach Huyen Port (expected to begin operations in 2025).
The deep-water ports can berth large container vessels and help cut logisticscosts as there is no need to send products to a trans-shipment hub. They also helpimprove the competitive edge of the local logistics sector.
Vietnam will continue to be an attractive destination for MNCs. Occupancy ratesat industrial parks has increased remarkably since foreign enterprises beganshifting their business to Vietnam.
Analysts anticipate several challenges for the port sector in the short term,however.
The Vietnam Marine Administration said that the total weight of goods handledat Vietnamese ports fell in October and November after rising 14 percent in thefirst nine months of last year.
SSI Securities Corporation attributed the decline to a shortage of emptycontainers, which is worsening in Asia as importers in the US and Europestruggle to return empty containers to Asian manufacturing hubs because ofsocial distancing at home.
This issue cannot be addressed overnight, since high demand for emptycontainers is likely to last until the Lunar New Year in mid-February, SSIexperts said.
Meanwhile, VDSC experts believe the country’s import-export activities will beaffected when demand from major markets like the US, the EU, and China fallsdue to the pandemic.
They forecast that Cai Mep - Thi Vai will see a surge of over 20 percent inmaritime transport flows owing to direct sea routes with the US and the EU. Thevolume of cargo settled at Hai Phong Port, meanwhile, is expected to rise 10percent thanks to a recovery in trade within Asia and robust signs in the US.
Increases in stevedoring prices are said to have less impact at Hai Phong Port.Fierce competition due to oversupply will force ports to cut service prices tomaintain relations with ship owners.
The stock prices of port companies have increased significantly due to thesector’s bright prospects and improving business.
From the end of the second quarter to January 8, the shares of the VietnamContainer Shipping Corporation, coded VSC, rose over 117 percent, while thoseof the Gemadept Corporation (GMD), Doan Xa Port JSC (DXP), and the Tan CangLogistics and Stevedoring JSC (TCL) increased over 82 percent, 68 percent, and27 percent, respectively./.
VNA
