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The ASEAN Smart Logistics Network (ASLN)

The ASEAN Smart Logistics Network (ASLN)

One year ago, on November 14, 2020, during the 37th ASEAN Summit the President of Vietnam and former Prime Minister Nguyen Xuan Phuc, and the Singaporean Prime Minister Lee Hsien Loong launched the ASEAN Smart Logistics Network (ASLN) together with its first project, the Vinh Phuc Inland Container Depot (ICD) Logistics Centre. Also known as the SuperPort. This article provides an overview about its goals, projects initiated, and potential opportunities for foreign investors.

ASLN – Enhanced Logistics in the ASEAN Region
Source: YCH Group

The ASLN serves as a platform which aims to promote logistics interconnectivity and integration within the member states of ASEAN. Moreover, it seeks to encourage the use of smart and sustainable logistics infrastructure. Also, the ASLN is a supportive means to ASEAN’s economic integration efforts and initiatives, such as the ASEAN Connectivity Master Plan 2025. A policy, which’s vision it is to connect and integrate ASEAN members seamlessly and comprehensively to promote competitiveness, inclusiveness, and finally a greater sense of community. Seamless logistics is one out of five strategic areas elaborated in the Master Plan. The area is focusing on two strategic objectives: lower supply chain costs and make the supply chains faster and more reliable in each ASEAN member state.

According to the Master Plan the previous initiatives have not reached the goals set in terms of logistics improvements. The reasons evaluated were named as a lack of coordination between government departments and sharing of best practices.

With the launch of the ASLN, the ASEAN is aiming to provide greater collaboration between logistics organizations, academic institutions, and the ASEAN member states with the shared goal of smart and sustainable growth.

Besides the ASEAN Connectivity Master Plan 2025, the ASLN is also assisting the ASEAN Smart Cities Network, and the ASEAN Integration Initiatives.

Vinh Phuc ICD Logistics Centre (SuperPort) in Vietnam
Source: Delco Construction

The inauguration of the ASLN was also the kickoff for its first logistics project in Vietnam. The SuperPort is going to be one of Vietnams largest logistics centers, which is situated in the northern province of Vinh Phuc near Hanoi. Not only will it serve as an inland transit point for domestic goods, imports, and exports. But also, as an inland container depot and a facilitator for customs clearance services for imports and exports.

The logistics center connects 20 industrial areas by road, rail, air, and sea. Furthermore, it is providing connectivity to the city of Hanoi, Hai Phong International Airport and China’s Yunnan Province, where the goods are transported via the Lao Cai border gate along the Hanoi-Lao Cai economic corridor.

The project is operated by the T&T Group of Vietnam and Singapore’s YCH Group. The investment made amounts to USD 166.68 million.

Phnom Penh Logistics Complex in Cambodia
Photo credit: Ministry of Public Works and Transport

The second project under the ASLN has been released by Cambodia’s Ministry of Public Works and Transport, and again by the YCH Group from Singapore.

The Phnom Penh Logistics Complex project will start in 2022 and follows the concept of the SuperPort in Vietnam. The costs for the logistics project are estimated at USD 200 million.

The aim is to build a state-of-the-art logistics complex, using latest technology to enhance resilience, visibility, and the process flow of the logistics. Moreover, it will feature a training academy and startup hub to train employees in the logistics sector of Cambodia.

Opportunities for Foreign Investors and Businesses

The Singaporean YCH Group is managing both ASLN projects by providing their expertise for the development of the logistics infrastructure. This example implicates the support needed from more developed countries to excel in the complex projects initiated.

Even though the main partners involved will be from the ASEAN region, foreign companies may contribute with consulting services, goods and services for the development of the logistics infrastructure, and with other kinds of collaboration. Furthermore, the funding of the projects might also be attractive for foreign investors who are or want to be involved in the ASEAN region.

Even if not directly engaged, these businesses will also profit from the implemented projects: greater integration within the ASEAN will lead to more efficient and faster logistics. This will benefit the trade in goods and services across the region and lower costs.

Outlook

So far, two major projects have been launched under the ASLN, which is said to improve logistics in the ASEAN region significantly. With the expertise of the Singaporean YCH Group and the willingness to collaborate, these projects are most certainly going to succeed and implemented as planned. More sustainable projects will follow, and further improve logistics infrastructure, which will not only benefit the ASEAN member states and their businesses. New and attractive opportunities will emerge even for foreign companies and investors.

Sources

https://www.businesstimes.com.sg/asean-business/new-asean-network-to-build-logistics-infrastructure-0

http://kinhtetapdoan.vn/trung-tam-logistics-icd-vinh-phuc-chinh-thuc-duoc-khoi-dong-d9510.html

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