Why you should invest in logistics in Vietnam

Vietnam currently ranks first in the list of ASEAN countries in terms of the number of enterprises operating in the field of logistics services licensed by the US Maritime Activities Administration (FMC). This proves the strong development of the logistics industry in this country. In particular, the logistics sector has been making an important contribution to Vietnam’s annual GDP, accounting for about 4% to 5%. So why invest in Logistics in Vietnam? Please join Siglaw to find out in the article below:

The current situation of logistics in Vietnam

The flourishing of the logistics industry in Vietnam does not stop at creating businesses and the financial value it brings. E-Logistics, also known as e-logistics, has raced with the age of digitalization and digital transformation. This has helped improve the quality of logistics services in Vietnam, making them more professional and efficient. E-Logistics has defeated the obstacle of time and space in the process of transporting and managing goods. Advanced technologies such as online cargo tracking systems, automated warehouse management, and mobile applications have helped optimize logistics processes, enhance responsiveness to customer needs, and minimize risks in logistics operations.

After more than two years of suffering severe impacts from the Covid-19 pandemic, Vietnam has witnessed a significant recovery in the logistics sector in 2022. Vietnam’s export and import volumes are setting records as we move into the “new normal” and take advantage of opportunities from the signing of Free Trade Agreements (FTAs) with international partners. This means that logistics has been playing an important role in promoting Vietnam’s economic development and creating growth momentum for the economy during this difficult period.

With continuous investment and development in the logistics industry and innovation through e-logistics, Vietnam is entering the future with great prospects in this field, while actively contributing to the development of the national and international economy.

Prominent foreign-invested logistics enterprises in Vietnam

Deutsche Post DHL Group

DHL is one of the largest U.S. postal and logistics services groups in the world, and they have a presence in more than 220 countries and territories around the globe including Vietnam. DHL has built a solid reputation for professionalism, reliability, and effective supply chain management. With an extensive staff and an international network, DHL not only provides postal delivery services, but also comprehensive logistics services, including transportation, warehousing management, customs services, and many other services to assist businesses and individuals in crossing borders and taking advantage of opportunities in the global market.

DHL’s presence in Vietnam has made an important contribution to the development of the domestic logistics industry and supported Vietnamese businesses to access international markets more effectively.

A.P. Moller-Maersk Corporation

Maersk is a multidisciplinary international business group, and it has built a strong position in the maritime shipping sector. With more than a century of industry experience and an extensive worldwide network, Maersk has become one of the largest and trusted maritime carriers worldwide. Maersk is not merely a shipping company but also operates in many other sectors such as offshore oil and gas exploration and consumer goods retail business. The diversity in business areas makes it possible for Maersk to provide integrated and comprehensive services to their customers, from transportation to logistics services.

With headquarters in Copenhagen, Denmark and worldwide branch network. Maersk has made a significant contribution to connecting the world and facilitating global trade. Bringing Vietnam to 8th place in the prestigious global logistics rankings is a significant achievement. Vietnam’s unique geographical location, with three directions bordering the sea, facilitates logistics and shipping. Maersk, with its global experience and network, has contributed to improving the quality and efficiency of logistics systems in Vietnam. This not only helps Vietnam attract foreign investment but also facilitates exports and imports of goods.

Nippon Express

Nippon Express Vietnam Joint Venture Company Limited is an excellent example of cooperation between prestigious logistics groups from Japan and Vietnam. This demonstrates the combination of Nippon Express Company’s long experience and high standards and Transimex’s extensive understanding of the market and local conditions.

Nippon Express Vietnam Joint Venture Company not only provides diversified logistics services, but also incorporates technology to improve efficiency and efficiency in their operations. This helps them meet the increasing demand for logistics from large global companies and corporations.

The partnership between corporations such as Nippon Express and Transimex adds value in the logistics sector in Vietnam, supports the development of this industry and helps improve the quality of services for businesses and customers.

Reasons why you should invest in logistics in Vietnam

Investing in the logistics sector in Vietnam is a reasonable and promising decision with many benefits. Here are some important reasons to invest in logistics in Vietnam:

• Dense seaport system: Vietnam has a rich and diverse seaport system stretching from the North to the South with a total of 286 ports in five groups of seaports. This has created a seaport system with a total length of about 95km of wharves, an increase of more than 4.5 times compared to 2000. The development of such a seaport system has played an important role in connecting Vietnam with international markets and facilitating international trade. One of Vietnam’s significant successes has been the establishment of gateway ports combined with international transshipment. This has allowed Vietnam to receive container ships with a capacity of up to 132,000 tons at Lach Huyen port area in Hai Phong and 214,000 tons at Cai Mep port area in Ba Ria-Vung Tau. This has provided Vietnam with the ability to receive and process international goods on a large scale, boosting the country’s exports and imports.
• Friendly investment environment: Vietnam has taken many measures to attract and create favorable conditions for investors in the logistics sector. Tax incentives, land regulations, and investment promotions have been applied. Moreover, the business environment is improving, and Vietnam has joined many Free Trade Agreements (FTAs) that facilitate the import and export of goods. The current customs procedures in Vietnam have also been improved, creating favorable conditions for logistics companies. Customs processes at ports and border gates have been shortened, which reduces waiting time and increases freight efficiency. In particular, with the electronic customs system, it helps to minimize human intervention and increase accuracy in goods management. This has helped speed up the customs clearance process and reduce the risk of fraud. The State has also set up industrial parks such as Phu Quoc Industrial Park and Van Don Industrial Park with special tax and management incentives to attract investment in the logistics sector. Import duty regulations are being adjusted to ease financial pressure on logistics companies. This makes importing goods more attractive.
• Infrastructure is growing: Vietnam is focusing on the development of transport and logistics infrastructure. Projects to build highways, improve railways and seaport systems are being implemented, helping to improve the efficiency and efficiency of logistics operations. This is especially important in the context of rapid growth of the economy and the rise of global supply chains.

For free and in-depth consultation on establishing a foreign-owned logistics company in Vietnam, please contact Siglaw Law Firm:

Head office in Hanoi: 12A floor, Sao Mai Building, No. 19 Le Van Luong Street, Nhan Chinh Ward, Thanh Xuan District, Hanoi City.

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