A new maritime container route between Cai Lan in Quang Ninh province, northern Vietnam, China, and Hong Kong was launched at the end of 2008. The route will help to foster trade between the northern border economic zones of Vietnam and its regional partners. Test runs for ships along the route began in November 2008, when the Mediterranean Shipping Company (MSC) vessel, the 1,090 twenty-foot equivalent units (TEUs) Wellington, was the first to arrive in Cai Lan. MSC had so far sent six vessels to the port, which is the only port in northern Vietnam that has the capacity to serve vessels weighing up to 50,000 dead weight tonnes. The inauguration of the new route also involved the opening of a new channel at Cai Lan Port. The Vietnam Maritime Administration, the Quang Ninh Port Company and the Waterway Project Construction Corporation launched the waterway, which is 10m deep and 130m wide. The province of Quang Ninh is part of a bilateral strategy between the governments of China and Vietnam to develop an economic corridor through the provinces of Yunnan, Lao Cai, Hanoi, Hai Phong, and Quang Ninh. Quang Ninh shares a 132-mile border with China and has a coastline of 250m. The province boasts five existing economic zones - Cai Lan, Viet Hung, Hai Yen, Dong Mai, and Hai Ha - and is investing in two further zones - Phuong Nam and Dam Nha Mac. Five further zones are currently in the planning stages. It is expected that the majority of the goods transported on the new Vietnam- China-Hong Kong route will be produced in Quang Ninh's industrial zones for export to China and Hong Kong. Trade between Vietnam and China has been steadily increasing in the past five-10 years. Data from IMF's Direction of Trade Statistics shows that the value of Chinese imports from Vietnam rose from US$929.1mn in 2000 to US$3214.42mn in 2007. The countries' commitment to trade co-operation was boosted in October 2008, when Vietnamese Prime Minister Nguyen Tan Dung held talks with Chinese government and state leaders. According to Quangninh Industrials News, the leaders agreed to promote 'two corridors and one economic belt' and to give priority to the development of economic zones. Despite strong shipping prospects on the medium term, Vietnam's industry will like the rest of the world be hit by the current economic slowdown. Taking this and other developments into consideration, along with our projections for the growth of demand, BMI's newly released Vietnam Freight Transport Report concludes that shipping traffic will increase by an annual average of 7.0% in 2009-2013, measured in tonnes per km. A number of factors underpin this forecast. One is the still-realistic prospect of a long, export-led boom in Vietnam, with annual GDP growth likely to average 6.4% in 2009-2013, only a little slower than the 7.8% rate achieved in the preceding five-year period. Infrastructure plans are also ambitious with many new ports under development. Our overall outlook for the nascent freight transport industry across the different modes is bullish. Despite a tough couple of years ahead, airfreight will grow by an annual average of 8.0% over the next five years. In road haulage, we have trimmed our forecast to take account of the economic slowdown. But we still see road-freight turnover running ahead of the general rate of economic expansion in Vietnam. We see it growing by an annual average of 7.9% over the next five years, followed closely by pipeline throughput (7.0%), rail (6.9%) and maritime freight (6.4% as already mentioned). Full World Trade Organisation (WTO) membership, achieved in early 2007, can be seen as supportive of greater freight transport turnover relative to GDP across all modes, particularly so for shipping. We now expect total freight carried growth across all modes, measured in million tonne-km (mntkm), to average 7.2% per annum in 2009-2013. Under BMI's freight transport rating system, Vietnam achieves a composite score of 58.3 out of a potential maximum of 100. Vietnam's stronger points are freight growth, transport infrastructure growth and the transport intensity index, which measures the dynamism of the country's foreign trade. BMI views Vietnam as being weaker in the other four categories: economic and political long-term risks and the country's regulatory and competitive environment (corruption is a particular problem). According to our latest estimates, the total value of transport and communications GDP will rise to US6.7bn in nominal terms by 2013, representing 4.5% of Vietnam's GDP.
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