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News117

As Infrastruture lacks Synchronism
WAITING  IN PUZZLE
By TBKTSG, 9 Jul 2009 

 

Synchronism is the target of any infrastructure investment problem. For this reason, without Synchronism, both the former and the latter will, indispensably, be in Puzzle and remain passive. The greatest Goal of Port Planning up to 2030 (being in the phase of final report before summitted to the Government for approval in this month) is to surmount the lack of synchronism. However, in reality, some Port Projects have expressed the lack of synchronism after entering into operation. And, many other industrial development Projects are in more puzzle as well.

 

Waiting

 

One year ago, among 7 investment Associations of the contruction and operation of Cai Mep-Thi Vai deep-water Terminals System, there were 3 Associations named STTV Terminal (the Association between Sai Gon and Huchison contruction investment trade Company); SP-PSA Terminal (the Association between Sai Gon Port and PSA Singapore Port) and CMIT Terminal (the Sai Gon Port – Maersk Port Association) were commenced while the others named My Xuan International Terminal, SSIT Terminal, Germalink Terminal and Cai Mep Ha General Container Terminal had to wait.

For this reason, according to Mr Pham Anh Tuan, the Project Manager of Portcoast Consultant Corporation (Portcoast), there was, at that time, no access Road to these Terminals’ sites. He added that the Road waiting for construction was at the length of over 3 kilometres, with a bridge over Nga Tu channel. Previously, 965 Road  - the only access to Cai Mep Terminals – had been invested by Saigon Petro Enterprise ( connecting 51 Highway up to the Terminal’s site of the Enterprise, of 7 metres wide and about 5,5 kilometres long). The 965 Road, after delivered to People’s Committee in Binh Duong Province, has become the key Road connecting Cai Mep Terminals up to 51 Highway). Owing to the importance of the Route, Ministry of Communications and Transport suggested and received the approval to the use of OAD capital for the investment of expansion and extension of the Route as to meet the need of cargo transport in Cai Mep Terminals. As the commitment of 85 Project Management Unit, the Road which is now being rapidly constructed will be accomplished in 24 months (since 2008) in order to serve the operations of these Terminals in time.

As calculated, the throughput Capacity of the 6 Cai Mep Terminals named Cai Mep Ha General Container Terminal, Gemalink Terminal, SSIT Terminal, Cai Mep Container Terminal (ODA capital), CMIT Terminal and Tan Cang-Cai Mep Terminal can be up to 6 million container TEU annually (one TEU equal to 20 feet container). Temporarily, all these Terminals will entirely depend on 965 Route connecting these Terminals up to 51 Highway. Now, in addition to Tan Cang – Cai Mep, whose phase 1 has been in operation, the others are in contruction or in preparation of contruction.

Constant Overload in Ports in Ho Chi Minh city has made difficulties for the Enterprise’s import and export while Cai Mep-Thi Vai is considered to be the southern Gateway Terminal by Ministry of Communications and Transport. In this context, it is extremely necessary to invest in infrastructure after the accomplishment of Port construction for synchronism in order to allow the Terminals to be in early operation. The Deputy Prime Minister Hoang Trung Hai, in the 20-year closing Meeting on Foreign Investment attraction in Ho Chi Minh city, June 27th, clearly pointed out such non-synchronorous investment and assumed that the lack of transportation Route connecting roads with Cai Mep-Thi Vai Terminals was one of the most obvious expressions.

The lack of technical Infrastructure System is a challenge even to Terminals which have been in operation. The SP-PSA Terminal Association in Thi Vai ( throughput capacity of about 1,3 million TEU/year) is one of the two Terminals, whose phase 1 has been in operation and at the length of over 400m of 1200m total as investors’ goal. The Road to the Terminal, starting from the access to Phu My industrial Zone connecting inter-port route is of more than 1 km left of accomplishment. The Association’s Singapore Investor himself has capitalized this stretch of the road owing to finding it impossible to wait.

Also, Tan Cang-Cai Mep Terminal, whose throughput capacity is about 1 million TEU/year, is now in operation of phase 1 at 300m/900m long. This means that throughtput capacity has been solved at the rate of 1/3 of the investment project. However, 965 Road, as mentioned, is in construction of expansion as well, which influenes cargo transport. In future, as accomplished, 965 Road will become a part of Cai Mep-Thi Vai inter-port Route as to synchronize technical infrastructure between Ports, road traffic and logistics (coastal services, trade). However, up to now, the inter-port route project, though latest, is still on the table. The difficulties are heaped up together when the overal picture of infrastructure System – the port in Terminal Complex no 5 is still uncompleted although the Government has decided to invest bond capital in Ba Ria – Vung Tau province in order to promote the rate of progress of the project.

Visionarily, according to Mr Tuan, if Port Infrastructure in Cai Mep-Thi Vai Terminal Complex is accomplished and Ports are allowed to enter into operation, 60-70% of throughput cargo volume will be shared through Ports in Ho Chi Minh city instead of being blocked as now. For the evidence, APL, one of the world’s top Enterprises of Container Transport has connected the direct transport route from SP-PSA Terminal (the only Terminal which is in operation of a part of phase 1) to the US, which helps to effectively shorten the two-day time of cargo transport from Vietnam to the US (from 17 days down to 15 days)

In Tan Cang, the nearest can also accommodate MOL Premium Vessel of more than 73.000 DWT, to be of Mitsui O.S.K Lines Shipping Agent (Japan). It is, up to now,  considered to be the greatest loading Vessel by Port Bussinessmen that lands in Vietnam’s Terminals because Ports in Ho Chi Minh city are, normally, abe to accommodate only Vessels of 30.000 DWT for berthing.

Back to the above unfinished access Roads to Terminals, Mr Tuan says that the internal Roads, in principle, must be invested by local authorities while the Port Projects are invested by investors and the major traffic life-line Roads are invested by the Government. Yet, local authorities can not afford to construct these Roads because local budget is limited while post-port technical infrastructure system takes up a great amount of invested capital.

The challenging difficulty has led to the reality that investors are taking reverse actions. This means that they have to invest in the Roads by themselves or use these temporary Roads. For this reason, the longer the State and local authorities keep waiting, the less effective direct operations of ports will be.

 

Steel Branch is in “Puzzle” as well.

 

Also relevant to Ports, Steel is one of the industrial branches which is burning to wait for deep-water Terminals’ operation. According to Mr Pham Chi Cuong, the Chairman of Vietnam Steel Association, Steel Enterprises’ competition leads to the lack of reliability of domestic limited energy resources and data base of reserves while Enterprises wish to actively invest in cupola Project. As a result, the Enterprises are in intention of importing Ore whether much or not. Since Ore export countries today such as Australia, Brazil and India are far from Vietnam, there must be Vessels and deep-water Terminals for Vessels of over 70.000 DWT. Also, it is better that there should be Ore Port Planning because it is impossible to use both Ore and Coal in General Terminals due to their dust. However, as Mr Cuong added, Vietnam is unready for everything, which is opposite to calling for Enterprises’ investment in the Project of Association of Cast Iron and Cupola Refinement, instead of Calefactors that can cause environmental pollution.

In fact, Importing Ore for Steel Production has ever been done before. Yet, even if Enterprises are extremely good at calculation, sometimes they have to yield to the complicated problem as infrastructure in Ore Ports. Since Steel and Ore are imported and exported one - day sooner or later, which attains or lose tens of million as the early months of 2008 and leads to cargo remains of overloading Ports, Enterprises can afford to do nothing. After Ports have been unblocked, Enterprises are not allowed to export. But, when allowed, prices will have sharply declined.

Ngọc Lan
(Translated by Portcoast)

 
 

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