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MOT plans to collect waterway fee despite business opposition

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MOT plans to collect waterway fee despite business opposition

Experts have warned that the waterway fee of VND70,000 per kilometer imposed on every 1,000 tons of goods would be a burden on businesses, which will lead to higher production costs and lower competitiveness.

The Ministry of Transport (MOT) is going to collect waterway fees from vehicles travelling on the Saigon River passage, from Binh Loi Bridge in HCM City to Ben Suc Port in Dau Tieng district of Binh Duong province.

 

Commenting about the plan, Professor Vo Tong Xuan, an agriculture expert, said: “The tentative fee is too high, and unaffordable for any transport firm.”

 

A lighter carrying 5,000 tons of rice from Long Xuyen Quadrangle to HCM City will have to pay VND70 million in waterway fees for the distance of 200 kilometers.

 

 

As such, every kilo of rice will have to bear an additional transport fee of VND14, the figure that Xuan described “absolutely unreasonable”. Every ton of rice will be VND14,000 more expensive.

 

Xuan went on to say that all the small merchants he has met, who collect farm produce from farmers to sell to processing and export companies, said it was unreasonable to collect waterway fees based on travel distance.

 

It would be better to collect fees once every year, the same mechanism being applied to the road toll collection, rather than charge money on the number of kilometers vehicles travel.

 

Meanwhile, an analyst warned that the MOT’s tentative plan to collect a waterway fee may spark a new wave of goods price increases.

 

“I think sellers would raise the selling prices two or threefold, reasoning the higher transportation cost,” he said. “The transport cost may increase by VND15, but the selling price would increase by VND60-70.”

 

He said that the new regulation would prompt investors to rethink their investment plans, because the high fee may make their business plan unprofitable.

 

Waterways have been the most popular means of transport in the Mekong River Delta for 200-300 years as it is cheaper to carry goods than on roads.

 

The MOT’s decision to collect fees on waterway vehicles will cause shocks to everyone in the region. Locals will have to pay higher prices for rice, fruits and vegetables which have been carried by waterway.

 

MOT has been told to learn from what is happening with the salt harvested in Quang Ngai province. The salt price has dropped dramatically to VND500 per kilo.

 

The problem is that the imported salt is cheaper than the salt from Quang Ngai. And imports from India are cheaper because it is less costly to transport goods from India than from Quang Ngai to Hai Phong Port.

 

Source: TBKTSG