Wednesday, November 20, 2019

Vietnamese Shipping and Shipbuilding Industry Under the Microscope

Half Day Conference Looks to the Future
Shipping News Feature

VIETNAM – SINGAPORE – The Asia Pacific Maritime (APM) 2020 exhibition and conference which will take place between 18 and 20 March 2020 at the Marina Bay Sands Expo & Convention Centre, Singapore, organised a half-day Vietnam Maritime Event in Ho Chi Minh city where local and regional speakers shed insights into issues impacting the Vietnamese and global industries. Yeow Hui Leng, Group Project Director, APM said:

“Vietnam has developed significantly over the past three decades and its economic outlook remains bright despite economic headwinds and global uncertainties. Rapid economic expansion has driven shipping demand. However, the country will need to stay atop of tightening regulations and modernise. As a platform that supports Asia Pacific shipping, APM is heartened to have leading maritime experts join us in addressing the current and future needs of Vietnam.”

Vietnam’s sea transport sector continues to achieve steady growth, with goods transported by the country’s fleet reaching more than 81 million tonnes in the first half of 2019, a year-on-year increase of 16%. Statistics from Vietnam Maritime Administration also indicated that in the same period, Vietnam’s ports handled 308.8 million tonnes of goods, up 13% year on-year. Changing tides in the global economy could further fuel this growth.

Though Vietnam’s shipping industry is poised for growth, many industry players remain beset with outdated maritime assets and limited access to capital, thereby hindering digitalisation. In light of this, the Vietnam Maritime Department issued an official call in late 2018 for Vietnamese maritime players and ship owners to accelerate the adoption of Industry 4.0 technologies. On this topic, Assistant Professor Okan Duru, Director of Maritime Studies, Nanyang Technological University (Singapore) said:

“Digitalisation is an inevitable investment for survival. If ship owners and operators cannot adapt to this transformation of Industry 4.0, they will be wiped out by Industry 5.0. Among various solutions of digitalisation, workplace automation and Ship 5.0 (embedded ship automation) will change the ecosystem dramatically. Tipping-point is not as close as perceived, but it is not that far.”

One of the concerns for the country’s maritime industry is the state of the merchant fleet, with the country’s ship owners often purchasing ‘end of life’ vessels. Speaking on this Bui Văn Trung, Secretary General, Vietnam Shipowners’ Association said:

“Vietnam’s national fleet consists mostly of second-hand ships, many of which feature technologies of 15 years ago or older, this puts us at a disadvantage amid fierce competition from newer ships of foreign owners. While modernisation is a must to survive, it is also a grave problem for the shipping companies, chiefly because of low profitability in business and lack of development funds, especially from commercial sources. The current shortage of skilled maritime manpower is also another problem for the ship owners in running their business.”

Another challenge facing Vietnam’s shipping industry is a dwindling fleet, the number of ships decreased from 1,600 in 2018 to 1,568 at present. But there are bright sparks in this arena, with international suppliers of equipment and spare parts trending towards the Vietnamese shipbuilding industry to leverage the vast local potential for growth. With opportunities coming Vietnam’s way, there is a need for shipbuilders to pick up pace.

Photo: Cai Lan Port, Hanoi.