Access roads to ports… too “far”

By Shipping Times, Sep 2009

"Far” does not refer to "distance" but ‘time’ spent to go in and out ports.

Foreign investors… response!

Some foreign investors, in the letter to the leader of Ho Chi Minh People’s Committee, have expressed their anxiety about the traffic jams in Ha Noi Highway area – Cat Lai T-junction, Ho Chi Minh city. In spite of having been improved in mornings since the early August 2009, the traffic is at a standstill in evenings, especially in the road from High-Tech Zone to Sai Gon bridge. Investors assume that traffic safety and its effect on health have been placed on a red alert, which takes considerably negative impacts on the foreign investment in this area.

Correspondingly, foreign investors have proposed some temporary solutions such as strengthening traffic police forces during rush hours, intensifying the method of traffic directional distribution, mobilizing barricades and traffic lights, forbidding driving and parking during rush hours in the above routes and paying a heavy fine for encroaching and speeding… With respect to fundamental solutions, investors have suggested to speedily accomplish the expansion of lanes and belt-line roads as to smooth trucks’operation in Cat Lai port area, exhibiting the collaboration of stabilizing the traffic and conducting the night construction between relevant offices.

“The foresaid obstacles are, if not satisfactorily surmounted, to take negative effects on the foreign investment in Vietnam due to significantly high costs arising from traffic jams” say investors. This is the first time foreign investors have raised an official proposal on the traffic jams in Ho Chi Minh city.

In reality, the lack of synchronism of infrastructure system network as a barrier for investors is not only situated in Ho Chi Minh city. For evidence, Thi Vai area sea terminal, according to the Planning, primarily depends on 3 main road routes: the inter-port road, the national highway 51 and the Bien Hoa – Vung Tau highway. Apart from the national highway 51, the others are still not yet “taken in shape”. Unavoidedly, the national highway 51, after the accomplishment of port relocation in coming years, is to find it extremely difficult to accommodate even only a half of number of containers transported from Ho Chi Minh city to Cai Mep terminal.

In addition, new road system in service of deep-water terminals is also nerving investors and transporters both. They assume that container traffic jams which are being situated in Ho Chi Minh city are to recur in Ba Ria-Vung Tau province also. For details, Vietnam’s first two deep-water terminals namely Tan Cang – Cai Mep and SP – PSA (phase 1) are weekly accommodating Vessels’cargoes by modern equipment while the road connecting the national highway 51 with the terminal is ‘equipped’ with pot-holes and the clearance is still in slow proces… Also, the gateway where vessels can enter Thi Vai deep-water terminal is bumpy as well. The channel near the buoy no 8 is about 500m in length and about 9.4m only in depth. As thus, vessels, for safety, should enter the terminal upon the tidal increase of additional 3.2m. Besides, the fishery on Thi Vai river is also blocking container vessels’operation. Presently, in addition to tug boats, there should be a cano to get ahead to smooth vessels’operation. According to an operator of a shipping Agent, no matter how loudly a vessel’s whistle is blown, fishermen keep casting fishing-net phlegmatically.

As stated by Mr Pham Anh Tuan, the Project Manager of Portcoast Consultant Corporation (Portcoast), the construction of transport and yard infrastructure system linking to the sea port on Thi Vai river is expected to be satisfactorily accomplished in 2015-2020 period.

Lack of….synchronism!

According to Mr Pham Anh Tuan, container ports along Thi Vai river, after coming into operation, are expected to accommodate 9-million-TEU-total cargos. Meanwhile, there, in 2008, was the 5.023 million TEU cargo throughput in sea ports in Vietnam, of which sea ports in Ho Chi Minh, Dong Nai and Vung Tau areas accounted for 70%. Accordingly, Thi Vai river port system, with the yearly 20% growth rate of container cargo volume, is to be able to accommodate the 9-million-TEU cargos only until 2020 and a few years later on, without transit cargos to be expected to be operated by foreign shipping Agents and port investors.

Presently, along Thi Vai river have come out very many ports. In addition to the two deep-water ports namely Tan Cang – Cai Mep and SP – PSA, there are a series of specialized ports and bulk ship ports having just come into operation such as PVC port, LPG port, Vung Tau Petro port, Go Dau area ports, Phu My port…, not including deep-water ports being in construction or in preparation of construction such as SITV, CMIT, SSIT, Gemalink, My Xuan and Cai Mep – Thi Vai (ODA capital). In reality, it takes about 3 years average to construct a sea port while it takes much longer time to construct a infrastructure system consisting of sound roads, railways, communications, power and water supplies As access roads are not yet constructed, sea ports are to be impossible to enter into operation. Presently, the two new-born deep-water ports in Thi Vai area are still accommodating containers mainly by waterway barges. In coming years, cargos from the surrounding industrial zones in Ba Ria – Vung Tau and Dong Nai provinces are to be transported to ports by road. Therefore, investors are surely to run into considerable difficulties if the construction of roads is still unfinished.

Noteworthily, it is essential to exhibit logistics in transit ports in order to attract customers. Currently, the planning of ship repair and supply services refers to supplies of drinks, food and gas only. For ship repair service, Vietnam finds it impossible to compete with other countries. Ship accessories, practically, have to be imported from Singapore and the cost and time of ship repair have no competitive advantages as a result, according to Mr Do Van Minh, the General Director of Gemadept. 

The empowerment of issuing investment licenses for local authorities is assumed to take considerable effects on the scale of projects as well as post-port infrastructure network. As documented by Portcoast, the former Prime Minister Vo Van Kiet, on his visit to Thi Vai port complex in 2005, highlighted the synchronism and interconnection between Long Tau, Sai Gon and Thi Vai rivers, and expressed his anxiety about the sign of “pettiness” and lack of synchronism. The former Prime Minister adds that waterway system is the common resource for the whole area and the motive for development not only for the Southern motive industrial Zone but also for the Western Highland and the Mekong Delta. Therefore, sea port plannings should not be divided based on administrative boundary.

In August 18^th, in SP-PSA international terminal, Verrazano Bridge Ship with the tonnage of 54.519 tons was launched for the first time from Vietnam to the East of the U.S  by K-line Shipping Agent. The Agent had previously launched its first ship to the West of the US. It takes about 15 days to directly ship containers from the departure to the destination instead of 17 days including a transit. In addition to the Shipping Agents namely APL, MOL, Hanjin and K-line exhibiting their ships in Tan Cang – Cai Mep and SP – PSA, a mass of significant shipping Agents namely Zim Line, Hapag Lloyd, Maersk Line, MSC… are expected to launch their ships to the U.S. However, SP – PSA and Tan Cang – Cai Mep terminals, upon the existing material facilities, find it extremely difficult to accommodate all the above ships.

On the accasion of Thi Vai river area deep-water port coming into being, foreign shipping Agents are planned to launch a mass of their ships to Vietnam. According to the Mitsui O.S.K Line Shipping Agent (MOL), the project on operating Cai Mep port as a transit port for the regional countries is up to the progress of port construction as well as the capacity of handling of ports.

Presently, Hiep Phuoc port area has begun to be “taken in shape”. In this area, there are a series of ports which are being constructed such as SPCT port (as invested by Dubai World - one of the world’s top sea port investors), Sai Gon – Hiep Phuoc port (stemming from relocation plan for Sai Gon port)… As appointed by the Chairman of Ho Chi Minh People’s Committee, the final items of SPCT port are in speedy construction in order that the port is to be able to come into operation in November 2009. There is currently one Nguyen Van Tao road only which connects to Hiep Phuoc industrial zone, where ports are all located. The local internal road has recently had to reluctantly “break its back” to bear thousands of trucks with the tonnage of tens of tons instead of 8 tons maximum departing from the industrial zone and has been seriously downgraded as a result. It is proposed that to avoid the increasing traffic jams in Ho Chi Minh area, waterway traffic be considered to be a life-line in Hiep Phuoc port area planning instead of road traffic as presently.

CKYH association group including COSCO, K-Line, Yangming and Hanjin Shipping Agents has just added Cai Mep area port group into the Asian Shipping Line to the North America. The Line, on route, is to pass over the Panama canal and arrive in the New York, Norfolk and Halifax cities located in the West of the U.S and Canada, i.e, large vessels launched from Cai Mep shall arrive in both the West and East of the U.S.

Khánh Hội
(Translated by Portcoast)