Establishment of the Cai Mep Ha Logistics Center along with the functionality of a Free Trade Zone

By vlr.vn - 01/12/2023

This was affirmed by Mr. Pham Viet Thanh, a member of the Central Committee of the Party, Secretary of the Provincial Party Committee, and Chairman of the Provincial People's Council, at the conference to disseminate and implement the Resolution of the Politburo on socio-economic development, and ensuring national defense and security in the Southeast region until 2030, with a vision towards 2045, held at the end of October 2023.

Turning Ba Ria - Vung Tau into a regional logistics and transshipment center

According to Mr. Pham Anh Tuan, CEO of Portcoast Consultant Corporation, the consulting firm for the Cai Mep Ha Logistics Center project, the CM-TV port cluster is facing significant challenges that need to be addressed to realize the vision of becoming a maritime center with an international transshipment gateway port. The area is currently lacking a post-port logistics zone and a supportive service ecosystem. Therefore, the establishment of the Cai Mep Ha Logistics Center will resolve these issues. This center will be a regional and global scale goods transshipment hub, along with the functions of a free trade zone. The project is an indispensable part of the CM-TV international transshipment gateway port and Southern Vietnam.

According to evaluations from maritime experts, the establishment of the Cai Mep Ha Logistics Center is very urgent. Currently, most export goods still undergo various processes such as container packing, inspection, and customs declaration at ICDs (dry ports) in other provinces, and are then transported by barges to be loaded onto mother ships in the CM-TV area.

"A large-scale post-port logistics center is a crucial requirement that any leading international port must plan and construct. For example, Busan Port in South Korea has planned a total area of nearly 700 hectares for its new Busan port's logistics center, aiming to handle about 32 million TEUs by 2030."

According to global standards, a large-scale post-port logistics center is an essential requirement for any leading international transshipment port to plan and build. For instance, the Busan Port in South Korea has planned a total area of nearly 700 hectares for its new Busan port's logistics center, aiming to handle about 32 million TEUs by 2030. With the projected capacity at CM-TV expected to reach 12.8 million TEUs by 2030 and between 34.5 to 41.4 million TEUs from 2030 to 2050, the establishment of the Cai Mep Ha Logistics Center is a very urgent requirement to meet the cargo handling needs of the port cluster.

Alongside this, the province will study the formation of a post-port trade area, planning various functional areas including: a duty-free zone, warehouses; a distribution center; and a specialized inspection center. This is to enhance the role of an international transshipment hub port, creating momentum to drive Ba Ria - Vung Tau to become a regional logistics and transshipment center.

Ready for the establishment of a free trade zone.

Mr. Tran Kim Vinh Tho, Deputy Director of Vung Tau Maritime Port Authority, believes that in terms of the role of free trade zones, the free trade zone model has become a distinctive economic development model that helps cities and localities play the role of an "economic locomotive" in the world. These zones are developing by leveraging opportunities arising from globalization and international economic integration, especially by taking advantage of the benefits from participating in Free Trade Agreements (FTAs). Developing areas following the free trade zone model will enable localities to maximize their comparative competitive advantages and developmental potential, thus making a comprehensive breakthrough in economic development as well as in all aspects of social life, amidst intense global competition at various levels.

Regarding this issue, Mr. Pham Viet Thanh, a Central Committee member of the Party, Secretary of the Provincial Party Committee, and Chairman of the Provincial People's Council, noted that free trade zones are a fairly common model, effectively implemented in many countries around the world since the late 20th century. Particularly, in recent times, there has been strong development of modern free trade zones in countries like China, South Korea, Dubai, and Singapore. The structure of the Cai Mep Ha Free Trade Zone in Ba Ria-Vung Tau, aiming for modernity, should include three layers forming the ecosystem of a modern free trade zone: an international transshipment deep-water port, a logistics center, and an industrial park.

“The formation of the Cai Mep Ha Free Trade Zone, linked with the East-West Industrial-Urban Corridor (nearly 300km long) from Moc Bai (Tay Ninh) down to Cai Mep Ha in the South of the country, will create a superior comparative advantage for Vietnam over other countries in Southeast Asia and the world in general in our country's new development phase,” emphasized the Secretary of the Provincial Party Committee.

In preparation for the establishment of the Cai Mep Ha Free Trade Zone, Ba Ria - Vung Tau province has proactively implemented several necessary tasks. These include updating the development policy of the free trade zone into the Ba Ria - Vung Tau Province Planning for the period 2021-2030, with a vision towards 2050. The province has organized the planning of the Cai Mep Ha Logistics Center covering an area of 1,686.73 hectares, and prepared a pre-feasibility study report for the project to submit for approval by the competent authorities. Efforts have been made to invest in transportation projects connecting inter-ports and inter-regional areas; coordinating with the Central Government and regional localities to promote the implementation of transportation projects connecting the Southeast region, especially linking the Cai Mep - Thi Vai port system with Long Thanh International Airport, the International Financial Center in Ho Chi Minh City, and various industrial and urban centers in the region. There has also been a push to initiate a feasibility study project for establishing the Cai Mep Ha Free Trade Zone.

Many opinions suggest that to swiftly establish the Cai Mep Ha Free Trade Zone, the province needs to determine the location and scale of the free trade zone within its jurisdiction, in alignment with related planning, current conditions, and development orientations for transportation and service connections (including logistics services) at a regional and inter-regional scale. Accordingly, the province should especially engage in dialogue and listen to the opinions of the investor community, including foreign investors. There's a need to review economic-trade policies and related policies, including those for human resource development and developing amenities to support the operations of businesses in the free trade zone. Research and recommend establishing an organizational model and a streamlined, effective management system, aligned with modern, transparent management thinking and methods, and with clear measurement of results for the free trade zone’s activities. Additionally, developing a plan to enhance institutional and technical capacity in preparation for the operation of the free trade zone is crucial.

Concurrently, Ba Ria - Vung Tau will complete transportation routes connecting the province to the Southeast region, promoting regional integration; establish a national-level logistics center, and set up a free trade zone linked with the seaport in the Cai Mep Ha area. This will attract strategic investors and design a complete, synchronized ecosystem, applying top international standards and practices.