The Future of Vietnam’s Logistics Sector: A Call to Action
A Paradigm Shift in Development Mindset
In a recent address at the Vietnam Logistics Forum 2025 in Da Nang, Prime Minister Pham Minh Chinh urged a transformative shift in how Vietnam approaches its logistics sector. No longer merely a support function, logistics is now recognized as a critical economic sector essential for maximizing local potential. The Prime Minister emphasized the need to move from a management mindset to one that enables and serves, aligning with the new Vietnam Logistics Service Development Strategy.
Identifying the Challenges
Vietnam’s logistics sector is currently grappling with numerous challenges. The Prime Minister highlighted that logistics costs in Vietnam hover around 16% of GDP, significantly higher than regional competitors like Singapore (8%) and Malaysia (12%). This indicates a need for streamlined practices and better resource management.
Infrastructure connectivity remains another hurdle. Existing regional linkages are often unsynchronized, making supply chains susceptible to disruptions, especially during natural disasters. Key weaknesses also include a shortage of large logistics enterprises and the absence of national-level logistics centers necessary for effective international cargo transshipment.
The Human Resource Gap
Another pressing concern is the lack of skilled human resources in the logistics industry. With the increase in global trade and e-commerce, there is a rising demand for professionals adept in new logistics services, such as green logistics, which focuses on sustainable practices, and logistics tailored for e-commerce. The existing workforce often lacks the qualifications necessary for an international working environment, highlighting an urgent need for upskilling initiatives.
Tapping into Untapped Potential
Despite its strategic geopolitical and geo-economic position, Vietnam’s logistics investment remains fragmented and inadequate. This fragmented approach has resulted in the underutilization of the sector’s vast potential. To break through these barriers, the government aims to set ambitious benchmarks: increasing the logistics sector’s contribution to GDP to 5–7%, achieving an annual industry growth rate of 12–15%, and reducing logistics costs to around 12–15% of GDP.
A Comprehensive Five-Point Strategy
To achieve these targets, PM Chinh outlined a comprehensive five-point strategy. This includes:
- Institutional Transparency: Clear regulations and guidelines will help foster a more conducive environment for logistics businesses.
- Green and Digital Infrastructure: Investments in sustainable and digital logistics solutions will be pivotal.
- Workforce Upskilling: Training initiatives will empower the workforce to tackle emerging challenges.
- Capital Mobilization: Encouraging investment in logistics infrastructure and services is essential for growth.
- Smart Governance: Connecting regulatory bodies with banking and transport sectors will promote a startup-friendly ecosystem.
Under this strategy, the government aims to propel Vietnam into the top 30 of the global Logistics Performance Index (LPI) by 2035.
Collaboration with Industry Stakeholders
The Prime Minister also called for industry leaders and associations to play a proactive role in driving digital transformation within the logistics sector. Their involvement is critical in not only elevating the standard of logistics services but also in promoting these services on a global scale.
Current Achievements in the Logistics Sector
Recent statistics paint a positive picture of Vietnam’s logistics landscape. According to a 2023 World Bank report, the country ranks 43rd out of 139 countries in the Logistics Performance Index, placing it among the top five in ASEAN alongside more established players like Singapore and Malaysia. Logistics costs have significantly decreased from over 20% of GDP in 2014 to currently around 16%, which translates to substantial savings for import-export businesses.
Moreover, synchronized investments have been funneled into logistics infrastructure, with a particular focus on enhancing the networks of seaports, airports, expressways, and logistics centers in vital economic zones such as Ho Chi Minh City, Hai Phong, Quang Ninh, Da Nang, and Can Tho.
The Growing Logistics Sector
The logistics business sector in Vietnam is gaining momentum, now featuring over 34,000 enterprises. This growth not only reflects the sector’s potential but also highlights the urgency for strategic interventions as the country seeks to realize its aspirations of becoming a logistics hub in Southeast Asia.
In summary, Vietnam’s logistics sector stands at a crossroads, with ample opportunities on the horizon. However, realizing this potential will require concerted efforts across various fronts, from institutional reforms and workforce development to enhanced infrastructure and strategic investments. The roadmap is in place, and the call to action has been made—it’s time for stakeholders to respond.