Trade Facilitation

Description

According to the World Bank Logistics Performance Index (LPI) (2012)  which measures countries’ trade logistics efficiency, Viet Nam is ranked 53rd out of 155. Viet Nam performs better than the averages of Asian and lower middle income countries except in logistics competence, which concerns the quality of logistics services. This finding is supported by the OECD Trade Facilitation Indicators (2013), which finds that Viet Nam outperforms in the areas of: involvement of the trade community and appeal procedures, while it needs to further improve in fees and charges and border agency cooperation. Export competitiveness has been seemingly affected by transport infrastructure deficiencies and increasingly higher fees and surcharges on foreign firms that dominate Viet Nam’s overseas shipping market. Compared to its regional competitors, Viet Nam has a relatively inefficient and expensive transport system. The road network consists predominantly of unpaved, narrow, local road sections; therefore, traffic is greatly affected by environmental and weather conditions. Moreover, according to the World Bank Doing Business Report (2013), exporting one standard container of goods takes 21 days and costs USD 610 in Viet Nam. However, it takes 11 days and USD 450 in Malaysia; 15 days and USD 585 in Philippines; and 14 days and USD 595 in Thailand. No significant business reform has been undertaken by Viet Nam for trading across borders since 2010 when it increased competition in the logistics industry as a part of the WTO membership reform program. (WTO 2013a; World Bank 2013).

Logistics Performance Index (LPI): Country Comparison
Logistics Performance Index – Evolution