Life cycle management and its application for port facilities in vietnam

Life Cycle Management and its application for port facilities in Vietnam Doan Dinh Tuyet Trang 01FF952 - Vietnam SUMMARY We are living in a society of great change.. Life Cycle Manage

JOINT JAPAN/WORLDBANK GRADUATE SCHOLARSHIP PROGRAM

INFRASTRUCTURE MANAGEMENT PROGRAM YOKOHAMA NATIONAL UNIVERSITY

Life Cycle Management and its application for port facilities in Vietnam Doan Dinh Tuyet Trang

01FF952 - Vietnam

SUMMARY

We are living in a society of great change Among others we can see changes in the central goals and requirements of construction technology Infrastructure is among the long lasting and most important products of our society Therefore， research and

application of good infrastructure management system is of great needs Design, construction and maintenance are the phases that cover the whole project cycle It is important to rationalize the whole process This is the main purpose of this paper

Design is an important part: converting the requirements of owner, users and

society into performance requirements of the structure system; creating and optimizing structural solutions which fulfill those requirements and finally, proving through analysis

and dimensioning calculations, so that these requirements are fulfilled Construction is

the next step; it translates design ideas into the real structure And after constructed,

Maintenance follows to maintain the life service of structure These components are the

main aspects of Life Cycle Management System This system supports an improved

quality approach Actually, it is an optimizing process to minimize the total costs and maximize the lifetime Therefore, its application gives many benefits in project management

Vietnam is developing country, both economic and infrastructure construction,

especially after Doi Moi in 1986 Up to 2020, Vietnam will have many construction

projects for infrastructure, both new and renovation ones, so investment for infrastructure

is increasing However, Vietnam is facing some issues, such as inefficient use of funds due to inappropriate surveying, planning, design, construction and maintenance, and insufficient funds to respond the requirement of infrastructure development Therefore, a good management system is necessary for present situation in Vietnam

Life Cycle Management and its application for port facilities in Vietnam Doan Dinh Tuyet Trang

01FF952 - Vietnam

Life Cycle Management with its benefits is a management system that Vietnam

government should pursue However, up to now “Life Cycle Management concepts”

have not been studied nor applied in Vietnam yet Therefore, I decided to select this matter for my thesis

Chapter 1 deal with present socio-economic situation, and transport system in Vietnam, including port system development plan

Present issues in construction projects in Vietnam and comparison with Japan’s case are the main contents of chapter 2 The development of economy leads to infrastructure development and vice versa However, Vietnam is facing some issues in construction project management This chapter analyzes these problems and compares with Japan’s case

Chapter 3 analyzes various aspects of Life Cycle Management and relationship among them The purpose of the application of Life Cycle Management and its advantages are presented in chapter 3

Chapter 4 describes the application of Life Cycle Management for port facilities in Vietnam, in Cai Mep Deep-Water Port This container port locates in Thi Vai Area, which

is one of the economic key areas of the south of Vietnam

Chapter 5 evaluates the importance of Life Cycle Management and its application, and gives some proposals for the application of Life Cycle Management in Vietnam

The main purpose of this paper is to present the Life Cycle Management concept and to analyze the benefits of its application This makes a new efficient tool in construction project management in Vietnam, so that the existing failures may not be repeated in future In addition, the thesis is to develop a good basis for me and other Vietnamese researchers to pursue further research in the field of Life Cycle Management

Abstract

We are living in a society of great change Among others we can see changes

in the central goals and requirements of construction technology Infrastructure is among the long lasting and most important products of our society Therefore，

research and application of good infrastructure management system is of great needs Design, construction and maintenance are the phases that cover the whole project cycle It is important to rationalize the whole process This is the main purpose of this paper

Design is an important part: converting the requirements of owner, users and

society into performance requirements of the structure system; creating and optimizing structural solutions which fulfill those requirements and finally, proving through analysis and dimensioning calculations, so that these requirements are

fulfilled Construction is the next step; it translates design ideas into the real structure And after constructed, Maintenance follows to maintain the life service of

structure These components are the main aspects of Life Cycle Management System This system supports an improved quality approach Actually, it is an

optimizing process to minimize the total costs and maximize the lifetime Therefore, its application gives many benefits in project management

Vietnam is developing country, both economic and infrastructure construction,

especially after Doi Moi in 1986 Up to 2020, Vietnam will have many construction

projects for infrastructure, both new and renovation ones, so investment for infrastructure is increasing However, Vietnam is facing some issues, such as inefficient use of funds due to inappropriate surveying, planning, design,

i

construction and maintenance, and insufficient funds to respond the requirement of infrastructure development Therefore, a good management system is necessary for present situation in Vietnam

Life Cycle Management with its benefits is a management system that

Vietnam government should pursue However, up to now “Life Cycle Management concepts” have not been studied nor applied in Vietnam yet

Therefore, I decided to select this matter for my thesis

The main purpose of this paper is to present the Life Cycle Management concept and to analyze the benefits of its application This makes a new efficient tool in construction project management in Vietnam, so that the existing failures may not be repeated in future In addition, the thesis is to develop a good basis for

me and other Vietnamese researchers to pursue further research in the field of Life Cycle Management

My thesis includes five chapters They are:

Chapter 1: Overview

Chapter 2: Present issues in construction projects in Vietnam – Comparison with Japan’s case

Chapter 3: General theory of Life Cycle Management Method

Chapter 4: Application of Life Cycle Management for port facilities in Vietnam Chapter 5: Conclusion

ii

ACKNOWLEDGEMENT

Special thanks to Government of Japan, World Bank, and Government of Vietnam for giving me this opportunity to pursue study in post graduate level in this prestigious university

I would like to express my sincere gratitude to my advisor, Professor Tatsuhiko Ikeda, who encouraged me to study in the field of Life Cycle Management for Structure, also for his valuable advices and guidance throughout my master’s study

Special thanks to Dr Eng Hidenori Hamada (PARI), Dr Eng Tarek Udin Mohammed (PARI), Mr Hideki Yokomoto (OCDI), for their valuable documents, research papers, helpful and advices comments

I would like to thank all administration and teaching staffs of IMP for their valuable lectures, and knowledge, also preparatory works

Also I would like to thank JICA for allowing me to take part in the internship course

“Port and Harbour Engineering” This course not only helped me to improve my knowledge but also gave me some new knowledge for my background

iii

CONTENTS

Chapter 1

1.1

1.2

1.2.1

1.2.2

1.3

1.4

1.4.1

1.4.2

1.4.3

1.4.4

Chapter 2

2.1

Abstract

Acknowledgement

Contents

List of Tables

List of Figures

Glossary

Overview National profile

Economic development situation

Economic summary

Vietnam’s economic development goals

Present situation of transport system

Port system development plan

The maritime transport system

Existing port system

Port development plan

Port development strategy toward year 2020

Present issues in construction projects in Vietnam – Comparison with Japan’s case Present issues in construction projects in Vietnam

i iii iv vii viii xi

1 3 3 5 6 11 11 12 16 20

25

iv

1

2

3

4

5

2.2

2.3

2.4

Chapter 3

3.1

3.2

3.2.1

1

2

3

4

3.2.2

3.2.3

3.3

3.4

Chapter 4

Can Tho Port

Ca Mau Fishing Port

Nam Can Port – Ca Mau

Some damaged cases due to construction

Some damaged cases due to corrosion

Present procedure in planning, design and construction in Vietnam

Japan’s past experiences in construction projects during high economic growth

New proposals for construction project management in Japan General theory of Life Cycle Management method Introduction

The main components of Life Cycle Management

Design process

Survey

Planning

Design

The relationship of survey, planning and design

Construction process

Maintenance and repair

The relationship of design, construction and maintenance

The Model of Life Cycle Management

Application of Life Cycle Management for port facilities in Vietnam

26 27 27 27 29

32

34 40

45 46 46 46 47 49 51 52 54 56 58

v

4.1

4.1.1

4.1.2

4.2

4.2.1

4.2.2

4.2.3

4.2.4

4.2.5

4.2.6

4.2.7

4.2.8

4.3

4.3.1

4.3.2

4.3.3

Chapter 5

The Southern Port System planning

Port group in the south of Vietnam

Port project site in Thi Vai – Vung Tau Area

Application of Life Cycle Management for Cai Mep Deep-Water port

The results of surveying

Analysis the socio-economic conditions, capacity of existing ports in this area

The prediction in future of cargo volume, vessel size …

Environment conditions

Position, function, and of port

Detailed Design of structures

The maintenance methods based on kind of structures, material use

Comparative study of some cases of structure

LCM for the existing ports

How to apply LCM system for existing ports

Estimation and prediction on progress of deterioration of reinforced concrete structures

Proposal some rehabilitation methods

Conclusion Reference

61 61 62

66 66

70 71 73 74 75

77 78 80 80

81 82 83

87

vi

Investment Requirement for the Transport Sector up to 2010

Port Facilities in Vietnam

Facilities in the Three Main Ports

Planning of Port Groups in Vietnam

Investment for Port Facilities in Japan (1995 price)

Construction Investment in Vietnam

Natural Conditions in Cai Mep Area

Cargo Throughput Volume and Number of Vessels at Ports in

HCMC (Vessel more than 1,000DWT)

Cargo Distribution by Ports in HCMC at year 2010

General Method of Repair and Rehabilitation

General Method of Repair and Rehabilitation

The Map of Vietnam

Present Situation of Transport in Vietnam

The Map of Major Ports in Vietnam

Location of Hai Phong and Cai Lan Ports

Da Nang Bay Port System

Port Development Plan in Vung Tau and HCMC

Position of Can Tho Port

Nguyen Huu Canh Retaining Wall collapsed

The crack of Nguyen Huu Canh Bridge

The break-down of the cover – Hon Chong Port – Southern of

The steel bar rusted and the cover gone away – K14 Berth –

Ben Nghe Port – HCMC

Present issue in construction works in Vietnam

Japan’s Port Investment and GDP from 1953 to 1998

Vietnam’s Construction Investment and GDP from 1979 to

2001

Main components of Life Cycle Management

Planning Process

Design Process

The Relationship among Survey, Planning, and Design

The Construction Management Cycle

The Factors concern with Maintenance, Repair, and

Maintenance

The Relationship among Design, Construction, and

Maintenance

The Model of Life Cycle Management

Port Development Plan in Vung Tau and HCMC

Major Port Project Site in Vung Tau and HCMC

Figure 4-3

Figure 4-4

Figure 4-5

Location Map of Natural Condition Survey

Distribution of Steel Material Corrosion Rates

The Cost Comparison of two Solutions

69

77

80

x

Economic Development Institute Export Park Zone

Inland Container Depot International Safety Management Code Industrial Zones

Global Maritime Distress and Safety System Ministry of Transportation

Port State Control Southern Focal Economic Area Stated – Owned Enterprises Standard of training Certification and Watch-keeping 1995 Vietnam International Container Terminal

Vietnam National Shipping Lines Vietnam National Maritime Bureau Vietnam Inland Waterway Administration World Trade Organization

xi

Chapter 1

OVERVIEW

1.1

1.2

1.2.1

1.2.2

1.3

1.4

1.4.1

1.4.2

1.4.3

1.4.4

National profile

Economic development situation

Economic summary

Vietnam’s economic development goals

Present situation of transport system

Port system development plan

The maritime transport system

Existing port system

Port development plan

Port development strategy toward year 2020

1 3 3 5 6 11 11 12 16 20

1-1 NATIONAL PROFILE

Figure 1-1 The Map of Vietnam*

*

http://www.vitranss.org

Vietnam occupies a land area of 329,560 sq km and measures 1,650 km from its northern border with China to its southernmost tip at the Eastern Sea Situated in the heart of Southeast Asia, with 3,260 km of coastline, Vietnam offers ideal advantages for economic development, trade and tourism

Mountains and tropical forest cover three quarters of Vietnam, but the flatlands make up the most heavily populated portion of the country The country's two "rice bowls" lie in the Red River delta in the north and the Mekong River delta in the south

Hanoi, in the north, is the country's capital, while Ho Chi Minh City, in the south, is the largest commercial city Da Nang, in the central part of the country, is the third largest city and an important port

Vietnam has two climates The southern and central regions have a tropical climate with dry and rainy seasons and are normally humid throughout the year In the north, the four seasons, including a distinct winter, are more defined Average annual rainfall is about 223 cm

Vietnam's population stood at around 78.5 million in 2000 The average population density is 246 people per sq km The annual growth rate is 1.5%

In addition to having significant potential in energy sources such as oil, gas and coal, Vietnam is also very rich in other minerals, including bauxite, iron ore, copper, gold, precious stones, tin, chromate, apatite, and building materials, such as granite, marble, clay, silica sand, and graphite This mineral wealth is complemented by significant marine resources, tropical forest, and agricultural potential

1-2 ECONOMIC DEVELOPMENT SITUATION

In such circumstances, the Sixth National Congress of Vietnam's Communist Party, held in December 1986, adopted an overall economic renovation policy Popularly known as "Doi Moi," the policy initially aimed at shifting economic priority from heavy industry to three major economic programs namely: production of food, production of consumer goods and production of exports; reducing state intervention

in business; and encouraging foreign and domestic private investment The Seventh and Eighth National Congresses of the Party held in 1991 and 1996 respectively reaffirmed its commitment to a socialist oriented multi-sectorial economy operating under the market mechanism and state management, and called for more structural reforms

One of the important policies of the Party and the Government at this time is to further accelerate the administrative reform, especially the institutional reform, organizational structural reform, public servants, public finance development and management Despite numerous difficulties as a result of the war-time policies, economic embargo, crisis in the former USSR and East European socialist countries that led to the absence of the political and economic support, Vietnam has gained impressive achievements in the Doi Moi process Today, Vietnam has been known to the world as a successful Doi Moi country International public opinion has highly appreciated Vietnam's economic reform and socio-economic achievements Most of

the economists share the view that: Vietnam's economic reform is not a gradual

reform but a comprehensive one, especially in the period of 1988-1989 which won

the consensus and strong determination of the whole Party and population

The "Doi Moi" policy has produced impressive results Despite the adverse impact

of the recent regional economic crisis, Vietnam's GDP doubled during the 1990 -

2000 period The share of GDP by economic sectors is changing positively As a proportion of the economy, agriculture has dropped to 24.3% in 2000 from 38.7% in

1990 Industry including construction took up 36.6% of the economy, up from 22.7%

in 1990 while the share of services increased slightly from 38.6% to 39.1% during the same period Inflation dropped from three digits in the 80s to less than 10% since mid 90s The exchange rate with the US dollar has remained relatively stable State revenue rose from 15.2% of GDP in 1990 to 27.2% in 2000 Domestic saving and investment also increased from 14.4% and 13.2% in 1991 to 27% and 22.1% of GDP respectively in 2000 [6]

In 2000, the GDP reached $US 31.3 billion and a per capita GDP was $US400 [6]

Exports grew by an average of nearly 20% annually from 1990 to 2000, about 2.6 times higher than the GDP growth rate In 2000, export earnings reached around US$14.45 billion, more than seven times higher than export revenue in 1990 As a result, the ratio of goods and services export - import turnover to the GDP has increased from 62.1% in 1990 to 104.7% in 2000 Trade deficits have been decreasing from US$4 billion in 1996 to less than US$ 1.2 billion in 2000 Vietnam has gone a long way from food importer to the world third biggest rice exporter The country has also emerged as the second biggest coffee exporter in the world after Brazil

Recent growth in the international export was heavily dependent on; agricultural sector and a booming manufacturing industry With the tough competition in the International export business, Vietnam signed several large trade agreements with countries in the West and also within South East Asia These countries include the U.S., U.K., Japan, China, Singapore, and several other large countries

With the result of having better trade relations, the country has been able to achieve their export quotas Also within 2000 Vietnam reported a net income of

$14.45 billion dollars from their export alone But with the lack of equipment and other materials for production, the cost of imports has also grown significantly, $15.64 billion in the same year

1-2-2 Vietnam’s economic development goals

The last year has seen important progress in Vietnam’s articulation of its development vision for the coming decade An important component of this has been the establishment of an set of social and economic goals for the 2000-2010 periods These are driven by a genuine concern for poverty reduction and improved quality of life for all citizens The broad goals are documented in the ten-year socioeconomic strategy endorsed by the Ninth Party Congress in April 2001, and in a series of sectorial plans and the draft five-year plan for 2001-2005

Table 1-1 Vietnam’s Socio-Economic Development Strategy for 2001-2010*

Vietnam’s ten-year Socioeconomic Development Strategy aims at eradicating hunger, reducing extreme poverty from 17 to 5% and improving the quality of life

of Vietnam’s population These goals are to be attained through rapid growth and

a change in the structure of the economy to a more modern, industrial and urban one that can create better-paying jobs:

• A doubling of GDP by 2010 to be attained through 7.5% annual economic growth;

• Investment to be increased to 30% of GDP from an average of 25% in the 1990s;

• Exports to grow at more than twice the rate of GDP growth;

• The share of agriculture in GDP to decline from 25% to 17%; industry to increase from 35% to 40%; and services to increase from 40% to 43%;

• The share of agricultural employment to decline from two-thirds to half; and

• The share of the urban population to increase from a quarter to a third

1-3 PRESENT SITUATION OF TRANSPORT SYSTEM

The transport sector of Vietnam consists of the full range of transport modes: road, railway, inland waterway, coastal and sea shipping, and aviation The transport sector grew significantly during the 1990s This was supported by the development of transport infrastructure during the 1990s and partial transport deregulation In addition to general reforms, the transport sector saw extensive commercialization Various new services commenced such as container transport on road, rail and inland waterway, bonded transport, ICD operation, scheduled liner operation even 1

in coastal shipping, liberalized transit transport between Lao PDR, etc The active investment in transport infrastructure with particular regard to the rehabilitation and upgrading of all modes, including urban and rural transport, has been continuing

There are 42 transport projects that are either on going or committed Many are expected to be completed by 2000-2003 The projects have a total cost of US$ 5.7 billion Of this amount, 72% is for roads followed by air (12%), ports (6%), railway (2%), inland waterway (2%), rural transport (3%), and urban transport (3%)

1

ICD – Inland Container Depot

* http://www.vdic.org.vn/eng/pdf

At present though, Vietnam’s transport infrastructure and services are still weak and there are a number of areas that need immediate attention: new or improved infrastructure is still needed to meet growing demand in many places Institutional arrangements and regulatory framework for transport services need to be further improved to facilitate the smooth flow of goods and people under a competitive environment There is also a growing concern among the government and donors about how to promote development of the transport sector more effectively, including building a sustainable infrastructure maintenance system, expanding domestic sources of funds, strengthening operation and management capacity, balancing investment between regions and between modes, encouraging private sector participation, implementing institutional reforms (especially within SOEs ), and 1modernizing infrastructure and management

Road and Road Transport: Vietnam has a total road network of over 200,000 km as

of 1999 National roads, however, account for merely 15,250 km The road network

in Vietnam is relatively well developed, but poor in quality and lacks clearly defined hierarchy

The main issues confronting the subsector include poor quality of service, poor primary/secondary roads, lack of tertiary roads, lack of legal framework, inadequate road safety programs, weak infrastructure management, especially at provincial level, and lack of sustainable financing

Railway Transport: The railway operates over 2,600 route-km, comprising seven

main lines and several branch lines The subsector faces issues such as lack of market orientation, low utilization of assets, huge backlog of infrastructure maintenance, lack of modern business tools, and inadequate financial/performance agreement between railway and government

Inland Waterway Transport: About 8,000 km of rivers are used for inland water

transport, of which 6,230 km are managed by the VIWA and the rest by local 2governments

1 SOEs - State-owned Enterprises

2 VIWA - Vietnam Inland Waterway Administration

Although inland waterways play an important role in the deltas, the potential capacity of the subsector is constrained due to various factors such as poor port services, weak market mechanisms, inadequate dredging and navigational aids, lack

of legal framework, weak infrastructure management, and lack of sustainable financing

Maritime Transport: Vietnam’s ports are virtually all owned and operated by the

state sector They are managed by VINAMARINE , VINALINES , local 1 2governments, and SOEs under ministries other than the MOT They suffer from 3shallow water depth and inadequate infrastructure and cargo handling equipment In spite of these constraints, cargo traffic through Hai Phong and Saigon has been constantly increasing VINALINES, which holds 60% of the total national fleet, shared only 11% of the total foreign trade due to stiff competition from foreign operators Domestic shipping consists of sea-cum-river shipping in the delta areas and coastal shipping

The issues facing maritime transport include limited competition in coastal shipping, lack of experienced management, poor condition of shipping fleet, inadequate port services and charging system, lack of modern handling methods, inadequate dredging, incomplete legal framework, weak maritime infrastructure management, and need to attract foreign investment in modern port facilities

Civil Aviation Transport: There are 135 airports/airstrips for civil, military and police

use in the country The CAAV is responsible for direct management of 18 airports 4(including the three major airports) and air navigation services The subsector is confronted by various issues, including limited competition, lack of experienced management, poor airport facilities, need to develop a new CNS/ATM system, 5inadequate legal framework, weak infrastructure management, and lack of sustainable financing

1 VINAMARINE – Vietnam National Maritime Bureau

2 VINALINES – Vietnam National Shipping Lines

3 MOT – Ministry of Transportation

4 CAAV – Civil Aviation Administration of Vietnam

5 CNS/ATM – Communication, Navigation and Surveillance/Air Traffic Management

Rural Transport: While primary roads are being rehabilitated, there is growing

concern about improving accessibility in rural areas where 80% of the country’s population resides The main issues in rural transport include limited all-weather access by motor vehicle, price controls on transport services, weak infrastructure management, and lack of sustainable financing

Cross-border Transport: A total of 24 provinces in Vietnam share the long border

(4,639 km) with the adjoining countries of China, Lao PDR and Cambodia The significance of cross-border transport can be viewed from both the regional and local perspectives The main issues in cross-border transport include limited and uncertain traffic levels, limited physical infrastructure and institutional bottlenecks

Multimodal Transport: Seamless transport services at reasonable cost to make the

transport sector more competitive has become an increasingly critical objective, both for international and interprovincial transport of goods The importance of multimodal transport concept is being recognized in Vietnam but services are still very much constrained due to various factors such as lack of guaranteed scheduled services, lack of cargo information systems, lack of modern cargo handling methods, poor access links to ports, physical constraints on containerization, bureaucratic bottlenecks, lack of legal framework, and need to attract foreign investment

Sector Management: Various subsector issues mentioned above are not specific to

particular subsectors but require a sector-wide approach Key transport sector management issues include weak management, need to divest remaining commercial functions, lack of trained staff and training policies, inadequate level-playing-field and basis for cost recovery, slow pace of SOE reform, and need to generate new revenue sources

Some figures about the transport present situation in Vietnam:

Figure 1-2 Present Situation of Transport in Vietnam [6]

Investment Requirement and Fund Availability: The investment requirement of

the Master Plan up to 2010 reaches almost US$ 11.5 billion in total capital costs Excluding that part of the investment required for revenue-generating projects, such

as expressways and ports, and the cost of transport equipment that operators should shoulder, the cost to government (central and local) is estimated to be about US$

10.5 billion (see Table 1-2)

Road accounts for about 65% of the cost to government, followed by rail (13.2%), port and shipping (11.5%), air (6.6%), and inland waterway (3.6%), However, the road subsector includes US$ 3.6 billion for ongoing/committed projects which is almost 50% of the total road investment cost

* Table 1-2 Investment Requirement for the Transport Sector up to 2010

1-4 PORT SYSTEM DEVELOPMENT PLAN

1-4-1 The maritime transport development

Since the 1990s, Vietnam has been successfully integrated with the global trade market Vietnam imports various industrial products and exports agricultural, mining and industrial goods Such an interactive economic relation is firmly supported by overseas shipping

Although there is no comprehensive policy framework available on Vietnam’s overseas shipping, some expressions regarding shipping nationalisms are observed

in government documents such as “transport right” But the utmost importance is how

to provide smooth and economical shipping services to shippers and consignees, since trade is the heart of the economy and transport influences the competitiveness

in trade Thus the policy to strengthen Vietnam’s overseas shipping industry should facilitate trade

* http://www.vitranss.org.vn

Coastal shipping has a significant role in Vietnam Between 1995 and 1998 the shipping volume doubled despite the Asian economic crisis, proving that the north-south economic linkage was tightened Many transport officers and planners believe that coastal shipping is an economical means to carry bulk cargo over long distances However, not many understand that coastal shipping could also compete even with truckers handling small consignment, if more container and roll on-roll off (RORO) ships would be assigned in liner operation

The shipping industry should be strengthened but without unnecessary protection measures In this sense, a liberalized market access with a level playing field is very much important Some policy interventions effective in neighboring countries should

be studied such as tax exemption for providing public service and a ship finance facility

Lastly, safety and environmental considerations will become more and more important in Vietnam There are some significant movements against maritime accidents, oil pollution and substandard ships, e.g., international conventions, regional agreements and joint operations These intend to enhance maritime safety and environmental protection through technical harmonization and upgrading and

joint enforcement of laws or regulations such as the GMDSS , STCW-95 , PSC , and ISM Code4 It should be noted that Vietnam shipping development must be sustainable as well as competitive

1-4-2 Existing port system

Vietnam’s ports are grouped based on geographic region – north, central and south Each region has major general port(s), small subordinate ports and independent industrial and private ports (see Table 1-3 and 1-4)

PSC – Port State Control

4

ISM Code – International Safety Management Code

In the north, Hai Phong Port has functioned as a gateway port ever since it began operations in 1876 with only a 60-m long quay wall Its physical nature as a river port, however, hardly allows large vessels of more than 7,000 DWT to call at the port The port also requires substantial and continuous dredging to maintain its access channel Under such circumstances, Cai Lan Port, 40 km northeast of Hai Phong, was proposed as an alternative deep-sea port in the first master plan in 1970 done by the former USSR After several revisions of the port development plan, three additional berths are now being constructed to supplement the existing one In the course of planning, designing and construction, there has been an increasing awareness to preserve the precious heritage of Ha Long Bay’s environment Besides the two ports, there is a local port network that includes small river ports such as Ninh Phuc, Hanoi, Viet Tri, and Nam Dinh Industrial ports for special cargo, such as coal, cement and oil, are also located along the sea and river

In central Vietnam, Danang Port’s function as a gateway has decreased since the country’s reunification But due to the area’s small population and insufficient industrial establishments in the hinterland, the port’s throughput is far behind from that of Hai Phong and Saigon ports, even though the Tien Sa jetties can accommodate vessels of 30,000 DWT Port development is very active in the region The existing facilities at Danang Port are being expanded with the construction of a specialized container heavy-lift pier (adjacent to the Tien Sa jetties) Port development, however, will have to overcome present problems such as high tidal waves, narrow cargo-handling area and a weak access road to the city center With port improvement and/or additional infrastructure, the three other major ports serving the long central coastline – Cua Lo, Qui Nhon and Nha Trang – can receive vessels

of 10,000 DWT throughout the year But with the limited traffic demand at present, the region needs industrial boom towns and transshipment/transit ports to generate sufficient traffic demand in many places such as Vung Ang, Chan May, Lien Chieu, Dung Quat, Van Phong, etc

In the south, Saigon River, the busiest navigational route, has numerous ports and can accommodate various kinds of vessels and barges with capacity up to 20,000 DWT Saigon Port, established in 1860, is the most important port in the country Located in Ho Chi Minh City, it can hardly modernize due to narrow cargo-

space and congested road traffic outside Since Saigon River cannot accommodate the bigger, modern overseas shipping vessels, the Vung Tau – Thi Vai Port area is becoming a focal point for planning new deep sea port facilities Although there are already many private ports and some small public ports in operation, there is no alternative to Saigon Port yet Similarly, many ports are distributed in the Mekong delta Among them, the largest and most promising is Can Tho Port which, after its rehabilitation and expansion, will allow direct export of agricultural and fishery products to neighboring countries With a well-developed inland waterway network, other delta ports, such as Vinh Thai, Cao Lanh, My Tho, Nam Can, My Thoi, etc., can be effectively linked to Can Tho Port and Ho Chi Minh City port groups

Administratively, there are eight major general ports and port areas including Hai Phong, Quang Ninh (Cai Lan, etc.), Nghe Tinh (Cua Lo, etc.), Danang, Quy Nhon, Nha Trang, Saigon, and Can Tho They are required to support the country’s industrialization and modernization so as to allow the country to become a competitive player in the global market They are, however, unproductive and less competitive due to the following reasons:

• Port area is small: The total length of berths in the eight ports/port areas of 8,267

m is, for example, roughly equal to Tanjung Priok Port in Jakarta (8,911 m), Port Klang (8,648 m), Manila Port (7,592 m) Vietnamese general ports are small Further, the country’s two main ports, Hai Phong and Saigon, suffer from limited land area for berth surface, storage and terminal due to congested urban areas

• Port depth is shallow: Vietnamese general ports are shallow with less than 10m in

depth of water, except for Danang Port (94 berths – 11 m, new berth under construction – 12 m) and Cai Lan Port (3 additional berths under construction – 12 m

at the maximum) On the other hand, international shipping operators are competing for the investment in larger vessels, especially in container haulage For instance, the ESCAP Study1 indicates that the suitable fleet size for future container operation (target year 2006) is as follows:

- Vessel class of 3,000 to 6,000 TEU for trans-Pacific routes;

- Vessel class of 1,000 to 2,000 TEU for intra-Asian trunk routes

Since only berths 12-m deep and 250-m long can accommodate under-Panamax type vessels (breadth: 17-31 m, length: 110-210 m, capacity: less than 1,700 TEU), most Vietnamese public ports must be designed to connect with intra-Asia feeder routes regardless of traffic demand

• Port operation is unreliable: Port operations in Vietnamese general ports are

inefficient There are many reasons such as shallow water depth and limited navigable time, poor navigation service, lack of well-maintained cargo-handling equipment, lack of trained port labor, inadequate supervision and management, and lack of incentives and unclear port charges

One state-owned operator reported that in 1998 they suffered a demurrage of 1,122 days from operating 21 general cargo vessels mainly because of wasteful waiting time for high tide and poor cargo handling

Foreign operators face difficulties in dealing with “dispatch money” and other incentives to port labor and management to achieve faster turnaround

• The container cargo handling operation is in its fledgling stage: The present

container traffic demand pattern is roughly estimated at 20% in the north, 10% in central Vietnam and 70% in the south Even in the south, the busiest container port, New Saigon Port, does not have enough space, modern equipment and technology

in container handling

1-4-3 Port development plan

Port development planning is conducted for many potential and existing sites throughout Vietnam There are several types and sources of port plans, namely: authorized plans by the Government’s office, private investment plans proposed by foreign developers, development plans by provincial governments or local developers, etc

In port planning, reliable data on and a rational analysis of past Vietnamese traffic trends, characteristics of neighboring or developing countries, world trends in port cargo and maritime transport, among others, are necessary to forecast traffic volumes As a second step, the feasibility of the site for port development is examined Major factors that need to be studied include the site’s natural condition, location on the world maritime route, conditions for vessels, accessibility to/from the hinterland, construction cost, and others After reviewing these fundamental data, the priority level of the project is then determined

Usually, however, relevant data on the above-mentioned items may not be available or adequate, hence an additional study is often needed For example, if a development plan for a new port needs to examine the site’s coastal and marine conditions and the size of port users in the hinterland and the gathered information is insufficient, a pre-study will have to be carried out

Based on the site survey and study, the current and future status of Vietnamese port activities can be summarized as follows:

1) Port traffic at five major ports has smoothly increased since 1991 In 1997, it suddenly dropped due to the Asian economic crisis but recovered in 1998

2) Container traffic at Hai Phong port has increased annually both in exports and imports and has become the prevalent type of cargo Domestic container has also increased remarkably

3) In Ho Chi Minh City (HCMC), container handling volume at New Saigon port has increased while general cargo at Saigon port has remained roughly at the same level

4) Cargo handling productivity in Vietnamese ports is still low and rehabilitation and improvement of facilities are necessary

15) Capital investment is centered on major ports especially for rehabilitation EDI or modernized management systems have not yet been introduced

6) The estimated container volume in 2020 is around 7 million TEU, the same volume recorded in Japan in 1988 This is enough traffic for mother vessels to directly call at Vietnam ports

7) Large volumes of bulk cargo, such as fertilizer and rice, will be handled especially

in southern Vietnam Mechanical loading and unloading systems should be introduced for efficient operation

1 EDI - Economic Development Institute

Table 1-5 Planning of Port Groups in Vietnam [6]

Amount of cargo to he Handled by port groups

(million tones) Name of port group

No of ports and port sites By 2003 By 2010

1 Group of the ports of Hai

Phong and Cai Lan and northern

ports

27 ports and

2 Group of ports in the northern

part of the central region (Thanh

Hoa, Nghe An and Ha Tinh)

3 Group of ports in the central

part of the central region (from

Quang Binh to Quang Ngai)

4 Group of ports in the southern

part of the central region (from

Binh Dinh to Binh Thuan - Phu

Yen)

11 ports and

5 Group of ports in HCM City,

6 Group of ports in the Cuu

7 Group of ports in the island of

Phu Quoc and those in

south-western part of Vietnam

8 Con Dao port group

passenger transshipment

Cargo and passenger fleet potential to build international

transshipment port

Figure 1-3 The Map of Major Ports in Vietnam [7]

1-4-3 Port Development Strategy toward year 2020

General Ports

• The central maritime administration should concentrate its public investment in nine major general ports, namely, Quang Ninh deep-sea port, Hai Phong, Cua Lo (Vung Ang), Danang, Qui Nhon, Nha Trang, Saigon, a deep-sea port in the Vung Tau-Thi Vai area, and Can Tho A major general port is located every 350 km along the coastline on average

• As a result of road improvement and road transport modernization, nine ports will

be accessible to shippers within one day Such a concentrated investment will also benefit shippers from many ship calls by larger vessels and modern cargo-handling services

• Cua Lo will be expanded to serve northern central provinces, such as Nghe An, Ha Tinh and Quang Binh However, when further expansion would be prohibitive due to the high costs of anti-siltation and dredging works, Vung Ang will become its alternative after the year 2010

Gateway Ports

• Three gateway ports will be developed in the northern, central and southern regions taking account of Vietnam’s long latitude Present gateway ports of Hai Phong and Saigon suffer from a limited port area and shallow water and thus deep ports will be necessary in Quang Ninh and Vung Tau-Thi Vai areas

The gateway function will be gradually transferred to these new ports In the central region, the gateway function is served by Danang port To ease the demand here, Tien Sa Port will be expanded and then Lien Chieu Port will be constructed Since gateway ports connect Vietnamese economy with international markets, the progress of port construction very much affects economic development Government should take full responsibility in port infrastructure development

• To enjoy the merit of deep seaport development, modern port operation and an efficient intermodal connection must be provided to port users by way of:

- Contracting out some port services to internationally competent operators such as container terminal operators,

- Simplifying port procedures and introducing port EDI, and

- Developing high-speed access transports such as road and rail in association with full-scale ICDs at both Hanoi and HCM City ports

Specialized Ports

• Specialized ports in association with specialized vessels, such as oil tankers, cement tankers, coal carriers, etc., are potent tools to enable mass haulage at economical transport costs Besides general ports and common carriers, however, the beneficiaries of specialized port development are limited Therefore maritime administration should set an adequate policy package to promote various specialized maritime transport systems and undertake only maritime safety and environmental protection

Local Ports

• From national/regional viewpoint, local coastal port development will be less significant than land transport development Provincial governments will maintain their operation as long as salient local traffic remains Therefore the central maritime administration is responsible only for maritime safety and environmental aspects around local coastal ports

• With regard to local inland ports, provincial governments should be responsible for their development and operation under the supervision of VIWA

C [7]

Figure 1-6 Port Development Plan in Vung Tau and HCM

Chapter 2

PRESENT ISSUES IN CONSTRUCTION PROJECTS

IN VIETNAM-COMPARISON WITH JAPAN'S CASE

Present issues in construction projects in Vietnam

Can Tho Port

Ca Mau Fishing Port

Nam Can Port – Ca Mau

Some damaged cases due to construction

Some damaged cases due to corrosion

Present procedure in planning, design and construction in Vietnam

Japan’s past experiences in construction projects during high economic

growth

New proposals for construction project management in Japan

Role of the construction industry

Construction Technology

Civil Engineering Design Department at Construction Firms

Research and Development

New proposal of the application of Life Cycle management in Japan

2-1 PRESENT ISSUES ON CONSTRUCTION PROJECTS

Since the Doi Moi policy was introduced in 1986, the country’s economy has

grown at an average rate of about 9% a year, though it has slowed down recently due to the recent Asian financial crisis Recognizing that infrastructure is a key catalyst for economic development, a large number of projects have been prepared and implemented in different subsectors, especially in transportation infrastructure The condition of infrastructure which was one in very poor state has been improved considerably The achievements in the sector during the first decade of reform are remarkable

Though unfinished work remains, the improvements have allowed traffic volume

to increase by 2.1 times in terms of passenger-km and 2.8 times in terms of ton-km, during the period 1990-1997 Vietnam, intending to become a member of the WTO 1and AFTA 2 and facing the next stage of national development, is building more effective transport systems to strengthen its economic competitiveness and degree of social equity, despite limited financial and human resources

Funding of transport infrastructure in Vietnam is severely constrained for a number of reasons such as low level of general revenue, inadequate pricing, lack of user charge policy, inefficient use of available resources, etc Investment in the transport sector has been about one-fourth of public investment in recent years or about 1.8% of GDP Although it has been advocated that transport sector investment should be 3% of GDP The estimated amount likely to be available for the transport sector from the government ranges between US$ 23 billion and US$ 45 billion for the next two decades [6]

Although infrastructure is developing, Vietnam is facing some problems related to construction projects Because demand of construction is so high while the fund is limited, appropriate fund allocation has to be critically assessed To implement above, an integrated management system, which covers from surveying, planning, construction, and maintenance, is need It is called Life Cycle Management System, but this system has not been studied nor applied widely in Vietnam Because of this, some faults were identified in some construction projects as follows

1 Can Tho Port

Figure 2-1 Position of Can Tho Port *

Can Tho Port is one of the major ports in Mekong River Delta Before 1997, due

to the shallow channel, only two vessels called per month Then, the government decided to dredge the Dinh An Channel and build the new berth in Can Tho Port for 10,000DWT vessel With this project, rice and other agricultural produce were expected to be from Can Tho Port, rather than Saigon Port as before Furthermore, the Can Tho Port development was said to improve socio-economic conditions of local resident

However, up to now the 10,000DWT vessels have difficulty in passing through the Dinh An Channel because of siltation, although this channel is dredged twice per year The major cause of this problem is due to inability to forecast the volume of siltation of channel Dinh An Channel changed its bottom shape easily with sediment, which is filled so fast However, surveyors and planner were not able to grasp this matter prior to implementation of this plan Can Tho Port is being used inefficiently; most of cargo is still transport from/to Saigon Port

* http://home.vnn.vn/eng/map