Lack of a regional logistics network hinders the Mekong Delta's sustainable growth

The Routable dialogue on September 6 with the theme "Joining forces for a sustainable transformation of the Mekong Delta" was held in Hanoi on September 6.  The event was co-hosted by the Ministry of Agriculture and Rural Development and the Embassy of the Kingdom of the Netherlands in Vietnam. Its objective was to provide a "helicopter view" of planning and potential interventions in the Mekong Delta, highlighting opportunities, challenges, priorities, and the focus of various stakeholders.

Insufficient logistic network

The logistics for agricultural products are both a bottleneck and a lever for the growth of sustainable agricultural production in the Mekong Delta. The Mekong Delta is a significant agricultural hub, with plans to boost rice, fruit, and aquaculture production to the top of the nation, which is why logistical operations are of interest and will require further investment in the future.

According to Ms. Nguyen Quynh Van, a representative of the Vietnam Institute of Strategy and Policy for Industry (Ministry of Industry and Trade), the Mekong Delta region has received special attention from the entire country, with many decisions and resolutions issued to promote the development of logistics activities in the region, such as the plan to build a center for linkage, production, processing, and consumption of agricultural products in the Mekong Delta. 

"The current and future market size of logistic services for agricultural production in the Mekong Delta is enormous, which is a result of rising foreign and local demand for the region's primary products. This encourages businesses and partners to engage in the region's logistic growth ", continued Ms. Van.

However, there are still some difficulties and challenges, such as the lack of a strategy to connect the logistics network in the region in terms of both transport infrastructure and services to make agricultural production and business more efficient and circular; the absence of a clear coordination mechanism among localities in the region; transport infrastructure that does not meet the needs of production scale, a small port system, and a low capacity; and a lack of logistics service infrastructure.

With the aforementioned advantages and challenges, Ms. Van made recommendations such as expanding the scale of agricultural production of farmers and businesses in the region, creating momentum for the development of logistics; creating mechanisms and policies to attract investment in agricultural logistics from outside the region; increasing investment in transport infrastructure in the direction of multi-modal transport, which includes connecting the road system with the inland waterway network; and establishing mechanisms and policies to attract investment in agricultural logistics from outside the region.

Enhancing cooperation on logistics for Mekong Delta's sustainable development

In fostering the development of the Mekong Delta, the authorities of the Ministry of Agriculture and Rural Development are also concerned with carefully directing logistical matters. According to Deputy Minister of Agriculture and Rural Development Tran Thanh Nam, the Ministry has agreed to focus on implementing and accelerating the restructuring of the agricultural sector towards sustainable, safe, and prosperous development, based on the development of high-quality commodity agriculture, in response to opportunities and challenges.

It also pays attention to developing key products such as rice, fruits, and seafood with high economic and nutritional value; combining them with services, ecotourism, and the processing industry based on the principle of efficient and sustainable use of natural resources; promoting and enhancing regional linkages' efficiency.

Moreover, the agricultural sector of the Mekong Delta fosters and promotes the growth of synchronous mechanization throughout the whole production chain.

According to the chairman of the Ministry of Agriculture and Rural Development, it is vital to building logistics hubs, which connect the production, processing, and consumption of agricultural goods throughout the whole area and nation.

Regarding the topic of the dialogue, the Ambassador of the Netherlands to Vietnam Kees van Baar recalled the June 2022 announcement of the Integrated Master Plan for the Mekong Delta for the period 2021-2030, with a vision to 2050. This is a long-term strategy that demands an interdisciplinary, integrated approach to support and promote high-value and sustainable agricultural output through the development of agribusiness centers, processing, and the improvement of transport and logistics infrastructure.

Mr. Baar explained that if Vietnam adopts this strategy, it would be able to "unlock" the Mekong Delta's full potential.

He stated that the Dutch government continues to maintain strong commitments to cooperation with Vietnam, along with the participation of the private sector and scientific organizations, in order to create conditions for the Mekong Delta region to have an economically and ecologically sustainable future. The two sides will collaborate closely to establish sustainable agriculture; transport, logistics, and agribusiness centers; water resource management, including the improvement of water quality.