VietNamNet Bridge – Vietnam has kept the door of its freight & forwarding service market opened to foreigners since January 11, 2012, and FedEx has become the first foreign company going through the door.

FedEx has officially applied for the establishment of a 100 percent foreign owned company in Vietnam, a shot signal for the wave of foreign express transportation companies penetrating the Vietnamese market.

The information has been confirmed by David Cunningham, President of FedEx Asia Pacific at the meeting with Dao Quang Thu, Deputy Minister of Planning and Investment, according to Dau tu newspaper.

The president, when informing the news to the planning and investment, expressed his hope that the government of Vietnam would support and facilitate the investment plan of the company.

If the investment is approved, FedEx would be the first 100 percent foreign owned express transportation company to operate in the Vietnamese market since the day Vietnam officially opened its market to 100 percent foreign owned companies in the field.

Prior to January 11, 2012, foreign investors could only provide express delivery services in Vietnam if they cooperated with the Vietnamese partners to set up joint ventures.

In fact, before becoming a member of the World Trade Organization (WTO), Vietnam had received some foreign service providers already. FedEx, DHL, TNT and UPS have all set foot on the Vietnamese market and increased their presence here through the joint ventures with domestic partners.

The presence of the world’s leading freight and forwarding service providers in Vietnam has been explained by the country’s rapid economic growth, which has led to the increase in the import and export activities between Vietnam and other countries in the world.

A report showed that by November 15, 2012, Vietnam had exported 98,55 billion dollars worth of products, an increase of 18.7 percent in comparison with the same period of the last year. Of these, mobile phones and accessories, the products which have been usually shipped by air, alone had the value of 10.67 billion dollars.

The representative of FedEx said he can see the great potentials of the Vietnamese market, where enterprises need to have their cargoes carried from Vietnam to other countries and vice versa. The developing business activities must not go through without logistics and forwarding services.

The Vietnamese market has become even more attractive to everyone, especially after the market is opened to 100 percent foreign owned companies. The fact that FedEx, which has been operating in Vietnam for the last 18 years by teaming up with Vietnamese partners, applies for the permission to set up a 100 percent foreign owned company here is a typical example showing the great potentials of the market.

Over the last 18 years, Vietnam FedEx has been developing very well. The specific flights to Hanoi and HCM City have connected FedEx and the clients in Vietnam with FedEx AsiaOne network, putting the transportation line through to 19 destinations in Asia and North America.

Other service providers have also taken the moves to increase their activities in Vietnam. In last September, DHL Express announced the opening of the new air route linking HCM City and the major transit centers – Hong Kong and Bangkok.

According to Christopher Ong, CEO of DHL-VNPT Joint Venture, the company would use Boeing 727F for the new service, which allows to handle 22 tons of cargo a day for the flights to/from Vietnam with the frequency of five flights a week.

Prior to that, in May 2012, UPS announced the investment deal of one billion dollars to develop its express forward and delivery technology globally. UPS said it has increased the investments in Vietnam, because Vietnam, together with China, have emerged as the main markets of UPS in Asia Pacific.

Compiled by Thu Uyen