The precinct where Thuan Hoa Phat Building Material Production Company is located in Cao Son commune in Hoa Binh province is full of bricks. Inventory bricks are piling up, putting a heavy burden on the business.

“There are about over 10 million bricks, worth tens of billions of dong,” a senior executive of the company said. “There is no more room to put bricks.”

The gloomy real estate market is a reason behind the high inventories of building material producers. However, the major reason is that the company cannot carry bricks to deliver to clients because of the ban on high-tonnage trucks, he said.

“In 2016-2017, when we carried out a feasibility study before building the production workshop, the road was open to trucks with loading capacity of over 10 tons,” he recalled. “But the local authorities released a decision on prohibiting heavy trucks from circulating on the road."

At present, only trucks with tonnage of 10 tons (both trucks and cargo on trucks must not weigh over 10 tons). Meanwhile, building material carriers all weigh over 10 tons.

This means that if the company wants to carry building materials to Hanoi, its trucks ‘only can turn right, cannot turn left to head for Hanoi’. The longer distance has increased transportation costs.

“Previously, when we could turn left, we just have to travel two kilometers to reach the big road, where there was no BOT (build, operation, transfer) toll collection. Every day, we have 20 goods-carrying trips, which cost us VND20 million for BOT tolls and oil now,” he explained.

“If using light trucks, only several thousands of bricks can be carried each time. It is not clear when all the goods can be released,” he said. 

“Therefore, trucks don’t want to come to our production workshop to take bricks away. Products are piling up,” he said. 

The company agreed to share the costs with transport firms, but they did not want to carry Thuan Hoa Phat’s goods because of bad road conditions.

Nguyen Minh Thao from the Central Institute of Economic Management (CIEM) said, at the NA sessions so far this year, state management agencies have been urged to support businesses to overcome difficulties by simplifying administrative procedures. 

The government has also directed agencies to support businesses and reform the business environment. Many sessions and legal documents have been released which emphasize the need to remove obstacles for enterprises.

However, Thao said, reform of the business environment has been going slowly.

“State agencies must not promulgate regulations that put more burdens on businesses and increase their law compliance costs,” Thao said.

Luong Bang