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Developing logistics key to new FDI flows

Released at: 16:26, 31/10/2015

Developing logistics key to new FDI flows

Conference in Da Nang told improved logistics would facilitate higher FDI post-TPP.

by Hoai An

At a seminar on the impacts of the TPP on investment attraction and trade in Vietnamese localities and on enterprises held in the central city of Da Nang on October 30, Mr. Nestor Scherbey, Head of the Customs & Trade Facilitation Working Group of the American Chamber of Commerce (AmCham) in Vietnam suggested developing logistics infrastructure to attract new foreign direct investment (FDI) flows and contribute to sustainable growth and greater competitiveness.

In Da Nang and many other localities in Vietnam, international services by wide-bodied aircraft are infrequent or non-existent and warehousing at airports is limited, while logistic costs are too high compared to other countries in the region.

Mr. Scherbey told local media that local authorities in Da Nang should propose the government pilot a free trade zone under the supervision of customs agencies. A free trade zone would promote production investment by tax exemptions on imported equipment components and machinery and reductions in administrative procedures and specialized monitoring requirements.

Analyzing the impact of the TPP on trade and FDI in Vietnam, Executive Director of AmCham in Vietnam, Mr. Herb Cochran, emphasized the key benefits of the agreement for the country, which include stronger connections with international supply chains and encouragement for administrative reform, promoting growth and creating opportunities. This is also a challenge for Vietnam, with FDI enterprises accounting for 70 per cent of the country’s exports.

According to, Mr. Cochran, Vietnam needs to improve to become a supplier meeting standards in the US market and the world to increase its export share in the international supply chain. In particular, Vietnam should look to increase the exchange of electronic data with D-U-N-S code (a unique international ID number with nine digits recognizing global companies in all transactions) for commercial activities as well as promote the development of transport and trade logistics to boost productivity and strengthen competitiveness.

In addition to improving trade infrastructure, innovation and improvements in business processes are also essential, in particular changes to import and export procedures to reduce the cost of trade after joining the TPP.


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