ITL enhances Vietnam’s logistics capabilities via sharing ecosystem ​

On December 2, in collaboration with Can Tho People's Committee, the Ministry of Industry and Trade organised the Vietnam Logistics Forum 2023. Deputy Minister of Industry and Trade Phan Thi Thang mentioned the challenges facing the global and domestic economy this year. She praised the logistics sector for playing a vital role as the lifeblood of the economy, ensuring the smooth flow of goods.

Currently, Vietnam ranks in the top 10 emerging logistics markets globally, according to Agility, a transportation and logistics services provider. The forecast compound annual growth rate for the industry from 2022 to 2027 is 5.5 per cent.

Tran Tuan Anh, head of the Central Economic Committee, also recognises logistics as an essential service that has made significant strides, contributing significantly to economic growth and employment. However, the industry still has limitations and has not fully developed with its potential.

For instance, according to the Vietnam Logistics Service Business Association, the average logistics cost in Vietnam is around 16.8 - 17 per cent, still higher than the global average of approximately 10 per cent. Reasons include limited logistics capacity, poor infrastructure and lack of connectivity between modes of transportation.

At the forum, Pham Hai Anh, deputy general director of Sowatco, a member of Sotrans Group (a subsidiary of ITL), proposed utilising the existing river system in the deltas through combining barges and dry ports, and inland container depots (ICDs).

For instance, in the Mekong Delta, the average freight rate per container from Can Tho to Cai Mep is around VND8.5 – 9 million ($350 - $370). Hai Anh suggested that developing waterway transportation using barges, combined with ICDs to connect to roads, could reduce costs by up to half.

“Using barges is a reasonable solution in the near future. In the long term, building more seaports and large-scale logistics hubs using barges is also the best way,” he said.

Pham Hai Anh, deputy general director of Sowatco, a member of Sotrans Group, a subsidiary of ITL at Vietnam Logistics Forum 2023

This proposal stems from his practical experience in Sotrans Group and ITL. As a leading integrated logistics service provider in Vietnam and the region, ITL has a sharing logistics ecosystem, offering flexible transportation solutions to meet customer needs.

This sharing ecosystem has been built on three factors for a long time: system connectivity, operational processes, and infrastructure. To effectively expand its ecosystem, ITL has expanded resources by synergising with major enterprises in the industry. Its acquisition of Sotrans Group in 2020, a leading provider in international and domestic transportation, multifunctional warehouses, seaports, and port logistics, is a notable example.

Currently, ITL operates 30 barges, more than five ports and ICDs all over the country, with a total warehouse area of up to 500,000 square meters. Along with a modern fleet of 500 trucks and prime movers, ITL ensures the organised and cost-effective transportation of goods.

ITL has a sharing ecosystem to provide customers various transportation solutions.

Alexander Olsen, vice president of Freight Management and Commercial of ITL, stated that the group continuously enhances the capacity of its vehicle fleet and infrastructure for the multi-modal transportation needs of customers.

"Within our ecosystem, we are continuing to develop barge transportation capabilities and the infrastructure system (dry ports, ICDs) around rivers. This approach creates flexibility in combining multi-modal transport and enhances fleet efficiency, which significantly reduces costs," he shared.

ITL is also the GSA of 23 airlines, operating cargo transportation in more than 200 flights per week, with a capacity of up to 150,000 tonnes of cargo per year. This advantage allows ITL to expand internationally, reaching wherever customers need.

With the ability to provide various logistics solutions - from international End2End cargo transportation to Cold Chain, ITL is the pioneer in supporting customers to optimise costs and transportation methods. Recently, ITL has continuously invested in its ecosystem.

On December 6, ITL was honoured in the “Top 10 Most Reputable Logistics Companies in Vietnam” under the category of International Forwarding, Warehouse Services, and Third-party and Fourth-party Logistics” by Vietnam Report JSC.

Continuing to leverage its strengths and ready to meet growing demands, especially amid positive market prospects at home and abroad next year, Olsen said that ITL continues to pursue its vision of building a sharing ecosystem.

This approach can not only enhance the competitive capabilities of Vietnam's logistics industry in terms of cost, but also aligns with the crucial goal of greening the economy. With a comprehensive and sharing ecosystem, ITL will continuously improve the efficiency and effectiveness of transportation solutions.

"Green logistics is becoming a global trend. At ITL, the continuous expansion of the ecosystem is one of the actions demonstrating our commitment to green logistics in Vietnam, aligning with the government's goal of carbon neutrality by 2050," said Olsen.

ITL: national champion of Vietnam logistics industry With more than five ports and ICDs, 500 trucks and prime movers, 30 barges and 500,000 square metres of warehouses all over the country, ITL offers various domestic and international logistics solutions, from End2End international freight, cold chain and general sales agent for more than 23 airlines.

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