Trade screeched to a halt in December after Beijing clamped down on the border to shut out Covid. So Vietnamese exporters desperate to offload cargo have driven to the frontier, unhooked the trailers carrying their shipping containers and let semitrucks from China’s side complete the final leg.
The elaborate relay race, which involves disinfection and other steps, is meant to salvage factory shipments hit hard by China’s latest lockdown crisis.
Vietnam has ditched the zero-Covid strategy but its communist big brother has not, triggering fears of a new bout of clogged global supply chains as China seals off places from the Shanghai port to the Vietnamese border.
“We’d like to have a ‘green flow’ created for goods from FDI (foreign-direct invested) enterprises, especially important goods that affect the progress of production and operations of factories,” Tran Thi Hang, a field employee of Thai Viet Trung Transport, said by phone from Lang Son, a Vietnamese province edging China, with vehicle horns sounding around her.
She joined the “contactless” trucking pilot after the logjam forced her drivers to camp out — sometimes for a month and a half — at the land border, which has turned into a parking lot where she estimates 500 vehicles are idling, down from a peak of 2,000.
How it works: A Vietnamese driver detaches his shipping container at the export processing yard, where only a crane operator and staffers covered from head to toe in protective gear can approach to prepare the cargo, according to a Lang Son government document.
A second vehicle then moves the container into position for the Chinese driver, who finishes the delivery and returns an empty container. Vietnamese TV also shows trucks passing through a carwash-like facility to be disinfected.
Hang’s company carries components and materials that wind up in LG devices and Nike high-tops. But such freight has taken a back seat to shipments of watermelons, dragon fruits and other perishables being prioritised by the governments on both sides of the border.
Valuable products like electronics shouldn’t be pushed down the priority list, said Hang, also warning that the disruptions could hurt the sourcing of parts and multinational investment.
China froze border crossings, including with Myanmar and Laos, after detecting the coronavirus on imports, even though the threat of the virus comes from airborne transmission.
Shutdowns have dragged on domestic commerce, too, with long quarantines making drivers reluctant to transport goods across provinces.
The border imbroglio has reached the top level of government, with the foreign ministers of China and Vietnam discussing it by phone on April 14. Hanoi summarised the call in a web post with a title saying they had agreed to “work together to remove obstacles in border gate clearance”.
The Global Times, a mouthpiece of China, said it would “build a smoother ‘green lane’ for the export of high-quality Vietnamese agricultural products to China”.
Vietnam has tried to ease the border impasse by digitising paperwork and having customs inspectors work at night and on holidays, in addition to contactless trucking. But businesses complain the trucking programme is expensive, time-consuming and unnecessary, the government’s Voice of Vietnam reported.
Dong Dinh Yen, a senior lieutenant at a checkpoint in Lang Son Province, said on state TV, “We found that this method is more convenient for freight shipping.”
As Vietnam struggles to shake the pandemic, the Southeast Asian country is highly exposed to the tumult in China, its biggest source of imported supplies.
While other categories are recovering, there was a 3% drop in imports of machinery, tools and parts in the first quarter versus a year earlier, for example, Vietnam’s Customs Department said. Those and other slowdowns have a knock-on effect for exports around the world.
“If exports are slow, the finished products will not be able to reach consumers in time,” Hang told Nikkei Asia. “If this problem persists, the fear is that FDI will move to other markets, other countries, where logistics are more favourable.”