.png)
Vietnam’s logistics sector faces labor shortage of 2 million people
The issue of labor shortage is becoming more severe as Vietnam is a member of ASEAN Economic Community AEC and is joining in a number of next generation free trade agreements.
With annual growth rate of over 10% and contributing 5% to the country's GDP, Vietnam’s logistics sector is facing a labor shortage of around two million people, according to the Vietnam Logistics Association (VLA).
Statistics showed Vietnam currently has 30,000 logistics companies, including 4,000 operating in cargo transportation domestically and internationally.
Notably, the majority of logistics firms operating in Vietnam are of small and medium size. 89% of them are local, 10% are joint-ventures and 1% wholly foreign owned enterprises.
The issue of labor shortage is becoming more severe as Vietnam is a member of the ASEAN Economic Community (AEC) and is joining a number of high-standard free trade agreements, VnEconomy reported.
A survey from the Ho Chi Minh City Institute for Development Studies (HIDS) revealed the Vietnamese workforce in the logistics sector is not only in short supply but also lacks the quality, particularly those assuming senior positions. Specifically, 53.5% enterprises lack staff with qualification and logistics knowledge; 30% have to retrain employees and only 6.7% are satisfied with the capacities of their employees.
Another survey conducted by the Institute of Economics and Development (IED) under the National Economics University indicated up to 80.26% of employees in logistics firms are trained through day-to-day work; 23.6% took part in local training courses; 6.9% are trained by international experts and only 3.9% joined training courses abroad.
The VLA predicted in the next three years, logistics firms in Vietnam would need 18,000 new employees and companies in other sectors would need over millions of employees with logistics knowledge.
Tran Thanh Hai, deputy head of the Import – Export Department under the Ministry of Industry and Trade (MoIT), said the quality of workforce training in the logistics sector should be improved to meet international standards and remove the weaknesses of Vietnamese human resources in logistics, including the lack of discipline and teamwork capability.
Hai suggested policy makers propose new teaching plans in the fields of logistics and supply chain in Vietnamese universities.
According to Hai, in order to develop high quality human resources in logistics, it is essential to have a joint-effort from the government, provinces/cities, logistics firms and vocational schools, while the government should continue to provide supporting policies for logistics.
Le Quoc Tien, vice principal of Vietnam Maritime University, said to improve the quality of teaching staff in logistics, the contribution of foreign and local logistics experts is necessary, as well as close the collaboration with logistics firms in setting up training programs in logistics.
Vietnam’s logistics and warehousing market is expected to register a positive compound annual growth rate (CAGR) of 13.3% in the 2018-2022 period, reaching a revenue of US$86.7 billion by 2022, according to Ken Research – a market research and consulting company based in India and the US.
Preliminary assessment of Vietnam international merchandise trade performance in the first 9 months of 2019
1.According to trade statistics of Vietnam Customs, in September 2019, a 6.7% reduction in total external merchandise turnover of Vietnam was recorded on a month-on-month basis. Exports went down 9.8 %, to USD 23.36 billion and imports shrunk 3.1%, to USD 21.75 billion as compared to the result of August 2019. As a result, there was a USD 1.61 billion surplus in Vietnam’s trade balance in this month.
2. In the first 9 months of 2019, Vietnam‘s trade-in-goods totaled US dollars 382.16 billion in value terms, 8.4% above the corresponding period of last year. As compared to result of a year earlier, total merchandise exports value rose 8.4%; to US dollars 194.65 billion and the total merchandise imports value grew up 8.4% to US dollars 187.50 billion. Accordingly, Vietnam’s trade balance in this period was in the surplus of US dollars 7.15 billion.
3. Trade data disseminated recently by Vietnam Customs announced that the total value of exportation and importation by foreign direct invested (FDI) traders reached USD 242.28 billion in total from beginning to September 2019, up by 5.1% as compared to the result of corresponding period of 2018. Total value of FDI exportation was USD 133.42 billion, went up by 5.3%. On import side, the total value of those companies was USD 108.85 billion, went up by 4.9%.
Main Exports and Imports
4. On a month-on-month basis, a decrease in total merchandise exports was due to the downturns in textiles and garments (down by USD 526 million); telephones, mobile phones and parts thereof (down by USD 479 million); machine, precious stones, precious metal and articles thereof (down by USD 258 million); …
5. On a year-on-year basis, exports grew up USD 15.10 billion. The main products, which contributed to the increase, were computers, electrical products and parts thereof (up by USD 3.85 billion); textiles and garments (up by USD 2.17 billion); telephones, mobile phones and parts thereof (up by USD 2.11 billion); …
6. On a month-on-month basis, a reduction in total merchandise imports was due to the downturns of the commodities as follows: machines, equipments, tools and instruments (down by USD 242 million); computers, electrical products and spare-parts and components thereof (down by USD 230 million); petroleum products (down by USD 146 million); …
7. On a year-on-year basis, imports went up USD 14.45 billion. The growth in imports was mainly contributed by the upturns of the following products: computers, electrical products, spare-parts and components thereof (up by USD 6.83 billion); machine, equipment, tools and instruments (up by USD 2.94 billion); crude oil (up by USD 1.53 billion); …
Trading Partners
8. In the first 9 months of 2019, Vietnamese merchandise trade with trading partners in Asia was totaled USD 249.71 billion in value terms, which moved up 6.4% as compared to the same period of 2018. Trade-in-goods of Vietnam with America was followed, which reached USD 70.72 billion and increased by 21.9%. The values of other continents were Europe: USD 49.19 billion, up by 3.6%; Oceania: USD 7.16 billion, up by 5.7% and Africa: USD 5.38 billion, down by 2.7% in comparison with the same period of last year.
9. For January-September period of 2019, 3 importing markets of Vietnam with turnover of over USD 15 billion were: The United States of America (reached USD 44.7 billion); China (reached USD 28.2 billion); Japan (reached USD 15.0 billion).
10. According to the following chart, top 3 big sources of Vietnam’s imports were as follows: China (reached USD 55.4 billion); Republic of Korea (reached USD 35.3 billion); Japan (reached USD 14.2 billion).
NYK, Dualog to Develop Cyber Risk Management System for Ships
Japanese shipping company NYK and Norway-based maritime digital platform provider Dualog have signed a long-term industrial research and development project agreement that would receive support from the Norwegian government fund.
The agreement will see the development of digitized products and services across a testbed of 50 vessels with a view to eventually being rolled out across the NYK’s fleet of 250 ships.
Innovation Norway, a governmental instrument for innovation and development of Norwegian enterprise and industry, will fund the project over the next two years.
Back in 2017, NYK and Dualog entered into a strategic partnership focused on pushing the boundaries for automation, the Internet of Things (IoT), and Big Data analysis. The partners have been developing data-sharing between ship and shore. In addition, they have launched a new Cepa Shield project that focuses on cybersecurity.
As explained, it will be possible to apply the cyber risk management system developed by the Cepa Shield project to all NYK-operated vessels, providing multiple layers of risk management.
When a cyber-attack comes from the outside, these features will help NYK to grasp from shore the condition of each vessel against the attack. NYK can then remain aware of any ships subject to a concentrated attack and in need of immediate protection.
The system will collect a variety of traffic information such as accessing servers from each application service. These will be merged into a monitoring system that will make it easy to determine what is going on and make it easier to take action if necessary.
“What we will be achieving is controlling communication at a new level, regarding protocols and security, but also in the way we will integrate different communications equipment onboard ship,” Morten Lind-Olsen, CEO of Dualog, said.
“We will also look at the way we want to dynamically control the bandwidth so we can undertake traffic shaping between different services.”
MSC Enters into Container Services Agreement with Mwani Qatar
Mediterranean Shipping Company (MSC) and Mwani Qatar have signed a container services agreement that will see MSC use Hamad Port as a regional hub for transshipment.
As outlined, starting from January 2020, MSC will manage up to 150,000 TEUs per year at the port, growing to one million TEUs by 2023.
“The agreement between “Mwani Qatar” and MSC is part of the Ministry of Transport and Communications’ strategic plan to transform Qatar into a vibrant regional trading hub in the region,” Jassim Saif Ahmed Al Sulaiti, Minister of Transport and Communications and Board Chairman of Qatar Ports Management Company (Mwani Qatar), commented.
“The agreement also enhances the competitiveness of Qatar and Hamad Port on the regional and international maritime transport map, as it will help attract more trans-shipment containers as well as encourage more international shipping lines to add Hamad Port to their regional routes and sign similar agreements in the future.”
“The agreement also contributes to the utilization of the differential advantages of Qatar’s strategic location on international maritime trade routes and enhances Hamad’s position and role in the national economy in line with Qatar National Vision 2030,” Captain Abdullah Al Khanji, Mwani Qatar CEO, added.
Former Maersk COO Toft Joins MSC as CEO
MSC Mediterranean Shipping Company has confirmed that Soren Toft, who resigned as Chief Operating Officer (COO) of A.P. Møller – Mærsk, would be joining the company as Chief Executive Officer (CEO).
MSC said Toft would report directly to Diego Aponte, Group President, and Gianluigi Aponte, founder and Group Chairman.
Toft comes to MSC after spending the past 25 years at Maersk, specifically as Maersk Line’s Chief Operating Officer since 2014.
“MSC is confident that this appointment will bring significant value to its cargo businesses, building on the company’s existing strengths and boosting its development plans even further,” the company said in a statement.
Toft will be relocating to Geneva, Switzerland, for his new position.
Maersk cfo Carolina Dybeck Happe quits to join GE
AP Moller – Maersk cfo Carolina Dybeck Happe is quitting the Danish shipping giant just weeks after the departure of coo Soren Toft was announced.
The announcement that Happe is to leave Maersk by end November 2020 comes just two weeks after Toft quit to join rival and 2M alliance partner MSC as ceo.
Happe is leaving Maersk to join GE as senior vice president and cfo, and according to a statement from the company will join in “early 2020”. GE chairman and ceo H. Lawrence Culp, Jr., said, “Carolina is a proven global cfo with a superior track record of delivering results and creating value.”
She only joined the Danish shipping company as cfo and a member of the executive board at the start of the year having moved from Assa Abloy.
"Over the past year, AP Moller - Maersk has progressed well financially, illustrated by the latest earnings upgrade in October 2019. With a reinforced financial foundation, we are well positioned for future growth,” said Soren Skou, ceo of Maersk.
“I would like to thank Carolina for her short, but productive time at AP Moller - Maersk. She is committed to building on the progress that has been made and ensuring a smooth and orderly handover. She will leave in 12 months at the latest.”
After Toft’s sudden departure earlier this month Happe was one of four remaining members of the company’s executive board. The board also comprises Skou as ceo and acting coo, Vincent Clerc as cco, and Morten Engelstoft, ceo of APM Terminals.
(Source: World maritime news; Seatrade maritime; Reuter, VN Customs news; American Shipper)
