Investors enticed by siren song of seaports

Vietnam’s seaport system is believed to be on its war to upgrades in the near future, with more and more investors showing interest in offering capital for these areas.

An international seaport project officially kicked off last week in Long An province. The two investors, who offered one billion dollars in capital, Dong Tam Group and VinaCapital, believe this will be an international seaport for the region.

“We believe in the success of the project, and for this reason, we decided to use $500 million of the infrastructure investment fund to invest in Long An international seaport,” remarked Don Di Lam, General Director of VinaCapital.

“We decided to invest in the seaport because we know the port is located in an advantageous position. As Vietnam is more deeply integrating into the world, the volume of import-export goods will increase in the near future,” he added.

Besides building a seaport that can receive ships of 30,000-70,000 DWT, the project investors will also develop an economic zone that includes an industrial zone, a service area and a new urban area.

Tien Len Steel Group Chair Nguyen Manh Ha also expressed his willingness to invest in a deep water seaport in Ba Ria-Vung Tau province. According to Ha, though Vietnam has many ports, more are still needed as some existing seaports cannot meet increasingly high demands of international clients.

The investment capital from the private economic sector flowing into seaport projects is rising, especially since seaport development is considered a profitable investment channel.

According to Vietnam Seaports Association (VPA), Vietnam’s seaport system now includes some 60 ports. The proportion of private investment in the seaports remains modest, but recently the figure has been climbing.

VPA Secretary General Ho Kim Lan affirmed that seaport investment can bring huge profits. He stated that investors can recover capital after just several years of operations.

“A seaport in an advantageous position with a good transport system, high quality services and simple procedures will certainly have high competitiveness,” Lan observed.

The Prime Minister promulgated Decision No. 2190, approving the seaport development plan by 2020 with the vision until 2030, under which, total investment capital in seaports by 2020 is 360-440 trillion dong.

It is expected that the volume of goods going through ports will be 500-600 million tons per annum by 2015, 900-1100 million tons by 2020 and up to 2100 million tons by 2030. In order to reach these goals, in the immediate time it is necessary to build deep water seaports capable of receiving big tonnage ships.

Dr. Tran Du Lich, an economist, stressed that seaport development must be in accordance with the Government’s master plan. He explained that it is necessary to pay attention to developing the transport system in the port areas, or ports will confront difficulties in operations.

Tags: Vietnam seaports