Ban on building of new terminals at Vietnam’s southern ports

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Vietnam has imposed a ban until 2015 on the construction of new container terminals in the southern part of the country to ease the acute overcapacity in the area.

The ban imposed by the Ministry of Transport covers the localities of Ba Ria-Vung Tau, Ho Chi Minh City, and Dong Nai.

The moratorium will last for two years.

Additionally, Ho Chi Minh terminals are barred from expanding their facilities.

The move is part of government efforts to increase operational efficiency at the southern ports and encourage greater use of the troubled Cai Mep-Thi Vai port complex.

Terminals at the Cai Mep-Thi Vai area have been registering huge losses due to underutilization, as shipping lines still prefer to use the ports in the other areas.

Actual throughput at Cai Mep-Thi Vai is only about 16 percent of capacity, according to a report by VietnamNetBridge.

The undercapacity situation at the port complex has grown so serious that it has sparked off a bitter price war that has further put operators there in the red.

The ministry will reportedly start issuing licenses for new port projects in 2015 after considering actual market demand.

But provinces and cities still have to allocate land for conversion into port projects later on.

 

Photo: staffan.scherz