Exporters face rising costs

Tuesday, Aug 11, 2015 08:06

The marine transport cost was estimated to increase by $300 per month, excluding supplementary fees for loading and documentation. — Photo thanhnien

HA NOI (Biz Hub) — Local exporters are facing additional pressure from rising marine transport costs charged by foreign shipping firms, which has led to Vietnamese exports becoming less competitive.

Several seafood companies exporting their products to the United States, Japan and countries in the European Union said their profits were down due to the rising fees. By the end of April, the transport costs saw a 50-70 per cent hike.

According to estimates, the cost of shipping a 20-foot container from Viet Nam to the US rose from US$2,300 to $3,800-3,900. The US is the country's largest importer, providing an annual, average value of $1.5 billion, accounting for 22 per cent of the country's total export value.

The marine transport cost was estimated to increase by $300 per month, excluding supplementary fees for loading and documentation.

Pham Thanh Binh, former director of the Customs Control and Supervision Department under the General Department of Customs, told Thoi bao Ngan hang (Banking Times) that some foreign shipping firms were collecting additional transport costs.

Pham Kieu Oanh, deputy general director of Nha Be Garment Company, told the newspaper that the company had implemented specific transport, loading and customs procedures since the middle of 2014, after the increase in marine transport costs.

They have used their own logistics services for 70 per cent of their cargo for three years. This has cost them only $15 per cargo load instead of $100 for the various transport fees. As a result, they have saved more than VND1 billion ($45,871) per month on transport costs.

However, many other enterprises don't have the financial strength and manpower to resolve these difficulties in this way. Most domestic exporters have only complained that the fees and supplementary fees charged by international shipping firms were not public and transparent.

In addition, Vietnamese goods exporters have no choice in the matter as foreign partners often choose the shipping firms for their imported and exported products.

Experts say enterprises should not wait for support from the Government but should improve their knowledge and professional skills in marine transport, delivery and foreign trade.

The enterprises were asked to collect their invoices on time to easily follow any changes to transport fees in order to construct a suitable business plan. Associations are expected to request the Government to implement regulations that require shipping firms to publish their fees and supplementary fees and to make this announcement ahead of any increase in fees.

The Ministry of Transport said fee collection by foreign shipping firms without a reasonable explanation or an unsuitable increase would create unhealthy competition or a monopoly in the market. The ministry has reported the issue to the Government.

Ministry officials will tighten regular supervision and examinations of marine transport companies and adopt a mechanism to control fees in the revised Maritime Code of Viet Nam. The concerned agencies have also researched local and international regulations to review whether the transport companies have violated laws on competition. — VNS

Comments (0)