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Expectations for first deepwater seaport in the Mekong Delta

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Transport of goods in the Mekong Delta has been facing several difficulties as roads have not been invested synchronously, waterway has not brought into play its advantages and logistics system is poor, leading to increasing transport cost. Therefore, it is essential to have an effective and long-lasting solution to solve import and export demand of the region.

Expectations for first deepwater seaport in the Mekong Delta

According to statistics in 2017, transport of goods in the Mekong Delta reached about 131.7 million tons, with average growth of 6.2 percent per year during the period from 2010 to 2017. Of which, export commodities were mainly three key products, consisting of seafood, rice and fruits, contributing around 18.7 percent to the country’s gross domestic product. 

Currently, export demand of the Mekong Delta is high, estimated at around 17-18 million tons per year with average growth of 10-15 percent per year. However, up to 70 percent of goods from the region had to be transported by road to ports in Ho Chi MinhC ity and Southeast region, making transport cost to increase by 10-40 percent per shipment, causing intense pressure on firms and reducing their competitiveness.

Mr. Le Duy Hiep, chairman of the Vietnam Logistics Association, warned that in the last five years, logistics expenses for export of seafood products and fruits accounted for 20-25 percent, much higher than that of 10-15 percent of other countries in the region. This is a serious challenge amid fierce competition all over the world.

In another aspect, waterway transport accounts for 70 percent of total amount of goods of the Mekong Delta. However, although the Mekong Delta region has several rivers and a 740-kilometer coastline from east to west, the region’s waterway network has not showed its advantages. Particularly, the inland waterway system has 57 inland ports, around 3,988 inland wharves and 1,404 ports and wharfs. Of which, more than 85 percent of ports are small-sized ones with capacity from 10,000 tons to below 100,000 tons per year, mainly used for unloading less-than-container-load goods. Meanwhile, there is a shortage of specilized ports for containers.

Meanwhile, the seaport system of the Mekong Delta has 7 ports and 31 wharves which mainly situated on rivers. However, acesses to these ports are limited, these ports are able to only receive 10,000 DWT vessels and 20,000 LWT ones.as a result, they can serve merely 20-25 percent of total goods that are need to be transported by sea of the region.

Mr. Nguyen Phuong Lam, director of VCCI Can Tho, said that despite huge amount of goods from the Mekong Delta, there is no deepwater seaport in the region. Transport of goods in the region has to rely on ports in Ho Chi Minh City. Meanwhile, ports in HCMC are overloaded because they also serve export demand for the whole country. Overloading causes cost to highly climb. In the next 10 to 20 years, the amount of goods from the Mekong Delta is forecast to be extremely huge. Therefore, if there is a deepwater seaport in the region, it will help transport of goods to be more easily and at a more reasonable level.

In order to meet the demand to directly import and export goods for the Mekong Delta, the Ministry of Transportation asked the opinions of provinces in the region for the adjustment of the Soc Trang Seaport project. Accordingly, Tran De Deepwater Seaport in Soc Trang Seaport was proposed to upgrade to a special seaport (grade IA). The port has an area of about 5,750 hectares and is able to accommodate vessels from 50,000 to 160,000 DWT. The investment is expected to be over VND40 trillion.

Tran De Deepwater Seaport will create favorable conditions for eight out of thirteen provinces in the Mekong Delta. It will be a hub for import and export of goods in the region. In addition, it will also share the amount of goods through ports in Ho Chi Minh City and the Southeast region which have already been overloaded and attract transshipment cargoes from Cambodia via the Mekong River waterway. At the same time, it will meet the demand to import coal for thermal power plants in the Mekong Delta. Besides, it will also contribute to establishment and development of industrial parks in the region with export goods estimated at 23.2 million tons by 2030.

By Tuan Quang – Translated by Thuy Doan

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