Bumpy road ahead for transport sector

Buses at the Mien Tay Station in HCM City (Source: VNA)

This point was made at a workshop on service conditions on January 23 by Nguyen Dinh Cung, Director of the Central Institute for Economic Management (CIEM).

His view was supported by Phan Duc Hieu, the institute’s deputy director, who was concerned that recent transport service draft laws would not be sufficient to solve shortcomings in practice nor overcome rapid changes in the market.

Hieu also acknowledged that traffic safety requirements for transport businesses under the current Vietnamese Law on Road Traffic were not clear and restricted business goals for most transport enterprises.

Sharing this view, Tran Duc Nghia, a board member of the Vietnam Logistics Association, mentioned one specific law provision - stipulating how transport business units must have parking spaces available and under local governance.

Nghia said such a rule should be removed, since it was appropriate in practice for passenger transportation, but not suitable for freight.  

Some other road traffic provisions were considered unnecessary and too specific to bind enterprises, creating unfairness between different transport sectors, such as strict conditions of ownership, which he thought were unreasonable.

Hieu said that current regulations stood on the side of suppliers, not demand or harmony between transport enterprises and consumers.

He hoped unfairness would be eliminated by future formulation of medium- and long-term policies, since benefiting consumers must be seen the basis for designing legislation.

A need for such a counterbalance stemmed from rapid urbanisation, expansion of services, application of information technology and fierce competition. 

Nguyen Van Lap, director of the Nuoc Ngam Bus Station, explained his unit’s difficulty, by mentioning restrictions on the allowed number of automobile rentals, limiting the market and legal rights of ownership for car rental companies.

Nguyen Cong Hung, deputy director of the Hanoi Taxi Association, said that traditional taxis businesses were constrained by too many business conditions. And as the price of gasoline surged, they were not able to re-adjust their fares in time. 

He recommended that for rate changes below 5%, taxi businesses should not need to notify state agencies, so they can cut down on costs and time.

Hung also proposed the use of yellow licence plates for taxis within city limits, which he believed would help regulate and create equity for all transport service vehicles.

Cung further said that prohibiting or restricting the use of electronic tools was contrary to State policies on encouraging technology to improve the transport sector.

In the end, he said that in addition to ensuring traffic safety, there should be regulations to encourage the transport industry, especially as the potential was huge. "Policy makers just need to put customers’ interests first," he said.

The workshop was organised by the institute in collaboration with the Logistics Association and the Vietnam Automobile Transportation Association in Hanoi, focusing on present issues and policy recommendations for business conditions.