Sun. Nov 27th, 2022

VietNamNet Bridge – The rapid growth in Vietnam’s international trade has
prompted investors to increase their investments postal services, express
delivery and forwarding.

Vietnam, delivery, logistics services, economic development, DHL

UPS, the US partner in VNPost Express, one of the four biggest express delivery
joint ventures in Vietnam, has become a 100 percent foreign invested enterprise
after it bought 49 percent of stakes from the Vietnamese partner.

Jeff McLean, General Director of UPS Vietnam, said the national export-oriented
economy has helped the service provide prosper over the last many years. The
joint venture has reported steady growth in Vietnam since 1994. In 2012, UPS
Vietnam’s export yield increased by 20 percent.

Christopher Ong, General Director of DHL Vietnam, which is believed to hold the
biggest market share in Vietnam, also said DHL has been witnessing steady growth
since it made its presence in Vietnam in 1988.

DHL Vietnam’s loyal clients are garment, footwear and wooden furniture
manufacturers. In recent years, electronics manufacturers have also become
regular clients of DHL Vietnam.

Like many other international firms, UPS penetrated the Vietnamese market by
cooperating with a subsidiary of the Vietnam Post and Telecommunication
Corporation (VMPT), acting as an agent providing logistics solution to
international groups and small and medium enterprises in Vietnam. In 2006, UPS
began operating under the mode of joint venture, while it has recently become a
100 percent foreign invested enterprise.

Analysts have commented that it is a growing tendency of joint ventures to shift
into wholly foreign invested enterprises which allows them to take initiative in
doing business and connecting their global networks.

Another US firm, FedEx, has also asked for the permission to set up a 100
percent foreign owned enterprise.

At the same time, Kerry TTC was officially set up after Hong Kong’s Kerry
Integrated Logistics bought Vietnamese Tin Thanh’s stakes.

Other smaller enterprises, including GeoPost Intercontinental SAS (France),
Linehaul Express (Hong Kong), Express Systems (Singapore), OA Cargo (the US)
have also been expanding their networks in Vietnam.

UPS now “covers” big economic centers which have high demand for logistics
services, including the Ba Ria – Vung Tau, Binh Duong, Hai Duong and Bac Ninh.
It has launched the service allowing to forward goods more quickly by 40 percent
in comparison with the traditional LCL service, applied to the containers from
HCM City to the US.

FedEx has been operating in Vietnam since 1994. It provides tens of flights a
week to connect the Vietnamese market with other big markets such as the US, EU,
China and Japan.

The face of the forwarding industry is believed to see big changes, when big
firms have made heavier investments when seeing the increasingly high growth
rate in Vietnam’s international trade. Joint ventures have shifted into 100
percent foreign owned companies. More and more new logistics companies have
joined the market. Meanwhile, existing domestic companies have also geared up to
grab the new opportunities.

According to Christopher Ong of DHL Vietnam, the investments in the exploitation
center at the Noi Bai and Tan Son Nhat airports, the open flights on HCM City –
Hong Kong route, the establishment of entrepot stations and customers’ centers
nationwide are the parts of the model that connects Vietnam and the Asian
biggest entrepot center in Shanghai.

He said the rapid trade growth between Vietnam and China, Japan and South Korea
is the great opportunity for delivery firms to take full advantage of the North
Asian entrepot center.


By vivian