Greening the supply chain and moving towards sustainable development are absolutely essential. Domestic and foreign consumers and enterprises are increasingly prioritising energy-saving and environmentally friendly products and services, so Vietnamese logistics companies need to adapt to keep up.

Principal of the School of Business at the National Economics University, Associate Professor Dr Tạ Văn Lợi talked to Vietnam News Agency about solutions for domestic enterprises to become more green in terms of logistics.

How does the green transformation trend affect the logistics industry in Việt Nam?

The world has a trend for green transformation. In particular, Europe has set criteria for the responsibility of all countries in protecting the environment and greening all production activities, as well as human activities on earth. Therefore, within COP26 on the green transformation, Prime Minister Phạm Minh Chính made a commitment that Việt Nam will achieve net zero by 2050.

These criteria will force the domestic logistics industry to green across two aspects, including infrastructure systems and services.

The infrastructure system must be greened, in terms of transport, and accompanying services such as packaging services, customs declaration services or other logistics-related services must be environmentally friendly.

Việt Nam has committed to reducing methane levels by 30 per cent by 2030 and achieving net zero by 2050.

Therefore, from now until 2030, Việt Nam will not encourage projects and vehicles using fossil fuels.

At the same time, packaging and transportation methods must aim to use materials and methods that do not affect the environment. Meanwhile, businesses, as well as green logistics suppliers, need to transform their transport methods and link together in purchasing and logistics operations, according to European standards.

What opportunities and challenges does the domestic logistics industry face in the green transformation?

In this green transformation, Việt Nam has favourable natural conditions in terms of its forests, rivers and streams, which it can exploit in terms of transportation. 

At the same time, it also has many natural materials for packaging and many alternative fuels, such as ethanol fuel.

However, Việt Nam is still a developing country, so the first challenge is the lack of capital for this green transformation.

The second is the lack of management experience. Of which, Việt Nam currently has a plan to develop logistics on the ground, but has no plan to exploit logistics services on the air and underground.

Another challenge is technology. Technology in some countries has moved on very far and very fast. For example, Europe uses hydrogen engines, while China is leading the way in developing electric vehicles.

Việt Nam needs technology to innovate the logistics industry towards greening.

These are huge challenges for the domestic logistics industry in the future.

What are bottlenecks for the local logistics enterprises in the green transformation?

The above challenges are the main bottlenecks for them.

Currently, Việt Nam has nearly one million enterprises, but the number of them in the logistics sector is about 82,000-83,000, mainly forwarders. Thus, Vietnamese enterprises are not yet capable of participating in the international logistics chain.

Previously, Việt Nam had planned to develop a number of shipping lines, such as Vinashin and Vinaline, to participate in transportation services in the international logistics chain. But this development was not successful, so the main Vietnamese businesses remaining in the logistics industry are small and medium sized ones.

These SMEs, of course, face the same three major challenges mentioned above, including lack of capital, lack of experience and especially lack of technological support. 

In addition, they also lack connectivity among them in implementing a green transformation.

How should the Vietnamese logistics industry start to carry out the green transformation?

First of all, there must be synchronisation in both the State and the business side. There are three most basic factors that they need to focus on implementing the green transformation, including development of enterprise quantity according to the green transformation strategy of the logistics industry by 2030 and the vision to 2045.

Second is a clear roadmap for each step of planning and implementation. In particular, they need really strong breakthroughs. Of which, the first breakthrough is innovation and national development model transformation. Developing a green logistics industry depends on the development model of each country.

Now, the world has development of logistics cities with underground, land and air logistics systems. Việt Nam also needs to plan and build such cities for green logistics development.

Second, they also have to build mechanisms and commitments on green procurement, and green linkages, especially, Government, sector and business spending. They must prioritise green products.

Third is technology policies. Many countries in the world are moving to a ban on fossil fuels and encourage the use of alternative fuels.

What additional solutions are needed to develop green logistics in Việt Nam?

The first solution is that the State must issue laws, policies and plans relating to green logistics development. Meanwhile, industries need to consult the State to build sets of criteria for the green transformation in the logistics industry.

In addition, provide awareness campaigns about green logistics development for consumers and businesses.

It also is necessary to support the logistics service businesses from capital, technology to management methods, to gradually transform into a green logistics model.

Meanwhile, commodity associations must strengthen connections and update the criteria of countries on green logistics for businesses.

At the same time, people and businesses need to prioritise the use of green products and green services. VNS