Strategies underway to augment the shipbuilding sector

Wrecking the Waves: Vietnam's Ambitious Shipbuilding Plans

Hey there! Let's dive into the nitty-gritty of Vietnam's grand plans to take over the global shipbuilding scene by storm.

Vietnam is gunning for glory by beefing up its shipbuilding sector, making the most of its strategic location and existing infrastructure. This ambition is part of a sprawling project designed to boost the capacity of domestic shipbuilders, all the way up to 2050. The project is waiting for the Prime Minister's approval, according to baodautu.vn.

This project builds on past planning efforts and aligns with the policy on restructuring the Shipbuilding Industry Corporation (SBIC). It also jives with strategies for sustainable marine economic development through 2045 and industrial development through 2035. That's what Deputy Minister of Construction Nguyễn Xuân Sang had to say about it, as reported by an online newspaper.

The plan is chock-full of specific targets for the shipbuilding industry over the next five to 10 years. By 2030, the SBIC restructuring project should be well on its way, with once-affiliated enterprises stabilized, reinventing themselves, and improving performance and management skills. The plan even recommends handing over key SBIC shipyards in defense-critical areas, such as Cam Ranh, Hạ Long, and Sông Hồng, to defense industrial enterprises. An SBIC representative stressed the importance of providing suitable support policies for domestic enterprises to inherit facilities, assets, and human resources from SBIC following bankruptcy.

Pacific Shipbuilding JSC factory in Hải Phòng City. VNA/VNS Photo

So, what's the endgame here? Well, by 2030, Vietnam's shipbuilding industry seeks to snag 0.8 to 0.9 percent of the global market, focusing on general cargo ships, containers, LPG carriers, and service vessels. The domestic market will also need to be renewed and expanded. On the export front, the goal is to crank out one million tonnes of vessels for international markets, which amounts to approximately 30% of total new output.

Looking even further ahead, the plan hopes to bump up the localization rate of shipbuilding products to 30-40% by 2040, with 10% in materials and equipment, and ultimately raise Vietnam's share of global shipbuilding output to 1% by 2040. By 2050, localization is projected to surpass 50%, with 20% in materials and equipment, and the industry is aiming for a 2% share of the global shipbuilding market.

With a current global market share of 0.61%, Vietnam ranks seventh among the world's shipbuilders, soaring past established shipbuilders like Finland. With an annual domestic shipbuilding capacity of around 3.5 million tonnes, Vietnam boasts both the industrial base and strategic geographic advantages to establish a stronger global presence.

But the journey won't be a walk in the park. The industry faces pressure to transform in the face of green energy transitions and carbon reduction mandates. Many shipyards lack the necessary infrastructure and capital to build eco-friendly vessels, and there's a notable absence of tax incentives or financial support policies to facilitate this change. Additionally, much of the shipbuilding sector has grown through basic assembly and processing, limiting its ability to produce high-value products. Outdated infrastructure and technology also undermine international competitiveness.

Việt Nam rises as a competitive force in global shipbuilding. Photo our websitePlus

There's also a need for investment in technological upgrades and ship design capabilities to build prototype vessels tailored to market demands. These constraints could hinder Vietnam's ambition to move up the value chain and grab a larger slice of the global shipbuilding pie. But fear not, the shipbuilding industry is recognized as a priority sector for investment, with various tax and land-use incentives already outlined in national regulations.

As Vietnam sets sail towards dominating the global shipbuilding scene, it faces competition from established shipbuilding nations but can leverage its strategic location and cost advantages. Adapting to technological advancements and sustainability requirements will be key to staying competitive. But with the right moves and some lucky breaks, who knows? Vietnam just might wind up as the wave-wrecker of the global shipbuilding industry.

Now that's one ironclad plan, folks! Cheers to Vietnam and the grand happenedstance that awaits them in the world of shipbuilding!

Vietnam is aspiring to fortify its shipbuilding sector, taking advantage of its strategic location and existing infrastructure, as part of a larger project that stretches up to 2050, aligning with policies on the restructuring of the Shipbuilding Industry Corporation (SBIC) and sustainable marine economic development through 2045.
The plan for Vietnam's shipbuilding industry includes specific targets for the sector over the next five to 10 years, aiming to capture 0.8 to 0.9 percent of the global market by 2030, focusing on general cargo ships, containers, LPG carriers, and service vessels.
By 2040, the plan aims to boost the localization rate of shipbuilding products to 30-40%, with 10% in materials and equipment, and to increase Vietnam's share of global shipbuilding output to 1%.
Though Vietnam currently ranks seventh among global shipbuilders, it has already surpassed established shipbuilders like Finland due to its industrial base and strategic geographic advantages.
However, the shipbuilding industry faces challenges in transforming to meet green energy transitions, carbon reduction mandates, and the need for investment in technological upgrades and ship design capabilities to build prototype vessels tailored to market demands.
Incentives in national regulations recognize the shipbuilding industry as a priority sector for investment, offering tax and land-use advantages.
With the right strategies and fortunate opportunities, Vietnam could potentially dominate the global shipbuilding scene, repositioning itself as a competitive force in the industry.