Lack of synchronous infrastructure causes logistics costs to increase
Logistics infrastructure is the biggest bottleneck that hinders Ho Chi Minh City's development of modern industry and trade. According to Mr. Truong Minh Huy Vu - Director of the Ho Chi Minh City Institute for Development Studies, many important connecting routes are currently not synchronous, increasing logistics costs and reducing competitiveness for businesses.
To develop industry, transport infrastructure must develop, logistics must be seamless, Mr. Vu emphasized. Accordingly, the Ho Chi Minh City Institute for Development Studies proposed investing in a specialized railway line serving the industry, connecting key production areas to seaports to reduce the load on the road system, which is already overloaded.
Not only industry, trade and services of Ho Chi Minh City are also facing similar bottlenecks. According to Mr. Bui Ta Hoang Vu - Director of the Department of Industry and Trade of Ho Chi Minh City, although the city plays the role of economic locomotive, accounting for more than 20% of the total retail sales of the country, the trade - service sector still lacks substantial cohesion between chains in the supply chain. In particular, e-commerce has developed rapidly but has not been effectively connected to logistics, production and traditional distribution systems, causing the market momentum to not be fully exploited.
From that practice, Ho Chi Minh City has identified a number of key orientations in the new period, notably the development of commercial - service space associated with the multi-center urban model. Ho Chi Minh City plans to form shopping - logistics - unit market - logistics centers in the southern area, connecting with belt routes and seaport systems. In addition, Ho Chi Minh City also focuses on comprehensive digital transformation, focusing on traditional markets, cooperatives and small and medium-sized enterprises in improving operations, governance, payment and distribution.
Digital transformation, green economy and zoning are the keys to growth
Vice Chairman of the Ho Chi Minh City People's Committee Nguyen Van Dung said that Ho Chi Minh City is facing a great opportunity to realize the vision of becoming an economic - commercial "super city" of the region. However, to achieve this, Ho Chi Minh City needs to take drastic, synchronous and strategic actions.
Ho Chi Minh City will recommend that the Central Government consider a specific mechanism to invest in modern trade - logistics infrastructure, while strongly promoting digital transformation in the entire supply chain. Along with that, developing a green economy and a circular economy is identified as the focus, in order to meet the trend of sustainable and environmentally friendly consumption.
According to Dr. Tran Du Lich, to maintain its role as a leader in the country's economy, Ho Chi Minh City must aim for double-digit growth in the next 5 years. However, the growth path cannot continue to rely on cheap labor as before. With the increasingly limited cheap labor force, the city is forced to shift to a growth model based on digital transformation and sustainable development (green transformation).
Ho Chi Minh City needs to comprehensively re-evaluate existing industries, consider the proportion of added value in the product structure, calculate the productivity of general factors (TFP) of each industry to determine which industry really contributes effectively. More importantly, the city needs to quickly adjust industrial planning based on the advantages of each area, while linking it with the overall planning of the Southern region to ensure harmony and maximize regional capacity.
