Hanjin Shipping Global halts operations: A big lesson in choosing shipping services

13:10 | 01/10/2016 Society

(VEN) - The bankruptcy of the Republic of Korea’s Hanjin Shipping Global has posed many consequences for Vietnamese businesses. The authorities recommended that businesses need to be cautious and change shipping service selection.

Hanjin Shipping Global halts operations: A big lesson in choosing shipping services

Large damages

According to the Vietnam Association of Seafood Exporters and Producers (VASEP), around 50 containers of seafood businesses delivered by the Hanjin Shipping Global remain stranded at sea. VASEP General Secretary Truong Dinh Hoe said that these seafood businesses do not know where their goods are and how to deal with the situation.

The bankrupcy has also affected many other export items. The Ministry of Industry and Trade’s Agency of Foreign Trade Deputy Director Tran Thanh Hai said that Hanjin is the largest shipping company in the Republic of Korea, accounting for about five percent of market share of goods delivery in Vietnam. As reflected by businesses, garments and textiles, footwear and leather, furniture and seafood have been affected. Many ports have refused to provide services for Hanjin, and customers have to move their goods to other carriers, leading to higher transport costs.

A halt of operations will have a big impact on Vietnamese exporters and importers as Hanjin is one of the 10 largest shipping companies in the world. These damages to Vietnamese customers have not been calculated, Vietnam Logistics Association Chairman Le Duy Hiep said.

Working together to support businesses

The Vietnam Logistics Association is actively updating information from the Ministry of Industry and Trade, the Republic of Korea Embassy in Vietnam and the Vietnam Trade Office in the Republic of Korea to give directions to its members.

Deputy Minister of Transport Nguyen Van Cong said that the ministry has directed the Vietnam Maritime Administration to learn international maritime laws, rules and practices in order to propose solutions to support businesses. This incident has not directed impact on Vietnamese ports, but mainly affects businesses.

The Saigon Newport Corporation has about 1,000 containers in service contract with Hanjin. It has worked with shipping agents to unload goods and will use services by other carriers to ensure delivery schedule.

The Ministry of Industry and Trade is working with the Ministry of Transport, together with port authorities to create favorable conditions for businesses affected by Hanjin. In the long term, the incident of Hanjin makes businesses more cautious in the use of transport services. Businesses must closely monitor developments of carriers to select appropriate services.

The Vietnam Logistics Association recommended that if businesses have service contracts with Hanjin, they should quickly do administrative procedures to regain goods and move to use other carriers to ensure delivery schedule. If goods are transferred to ports, they need to cooperate with their shipping agents to unload goods. In a case where goods are on board to move to destination, service providers for Hanjin will detain vehicles and equipment until someone stands up to pay debts for Hanjin. Businesses must closely monitor the process to release their goods as soon as possible.

Regarding insurance issues, Vietnamese logistics businesses should inform owners of goods in order to seek solutions to reduce damages.

The Republic of Korea’s Court Receivership has not yet made a formal decision on Hanjin. However many creditors have seized Hanjin’s vehicles and equipment. In particular, many ports have refused to provide services for Hanjin.

 

Lan Quynh Linh

Theo ven.vn