"Greening" the logistics industry: The key to sustainable business development

DNHN - Developing green logistics is no longer just a trend but is gradually becoming an essential requirement for activities spanning from the procurement of raw materials, production, distribution, delivery, covering the entire life cycle of products.

On the afternoon of July 9, in Hanoi, the Vietnam Chamber of Commerce and Industry (VCCI) in collaboration with the Vietnam Logistics Business Association (VLA) organized a seminar on Green Logistics Development, Rapid Adaptation, and announced the FIATA World Congress 2025.

Developing green logistics is no longer just a trend but is gradually becoming an essential requirement

At the seminar, Mr. Nguyen Quang Vinh, Vice President of VCCI, stated: "Green growth and sustainable development are inevitable requirements, irreversible, and a global trend in the current period. The national strategy for green growth for the period 2021-2030, with a vision to 2050, has set goals to green various economic sectors, promote economic restructuring associated with innovating growth models, environmental sustainability, and social equity. This strategy assigns tasks to relevant ministries for 'developing green logistics' including green logistics centers, green ports... To implement this strategy, the Prime Minister issued Decision No. 882/QD-TTg approving the national action plan for green growth for the period 2021-2030, in which logistics services are one of the 18 key topics of the plan".

A survey by the VCCI’s Business Council for Sustainable Development showed that transitioning supply chains and value chains towards greater sustainability is a trend that the international business community is very interested in and prioritizes. Accordingly, green supply chain management is linked to managing its links, including green design, green production, green operations, green procurement, green logistics, waste management... When these links are all 'green', businesses will be able to enhance production capacity, operational efficiency, and form a green, sustainable ecosystem around them, thereby creating competitive advantages and increasing the resilience, adaptability, and recovery capacity of businesses to market shocks.

"From this requirement, developing green logistics is no longer just a trend but is gradually becoming an essential requirement for activities spanning from the procurement of raw materials, production, distribution, delivery, waste management, covering the entire life cycle of products. The Government's Resolution No. 163/NQ-CP on promoting the synchronized implementation of key tasks and solutions to enhance competitiveness and develop Vietnam's logistics services has also identified the development of logistics associated with sustainable supply chains", Mr. Vinh said.

Speaking to reporters, Mr. Le Quang Trung – Vice President of VLA cum Deputy General Director of Vietnam Maritime Corporation said: "The green transition is very important for logistics activities specifically and for import-export activities in general. According to the Government's commitments, VLA along with logistics companies related to seaports, services, shipping companies, warehouses are making efforts step by step to transition logistics activities and switch from using conventional loads to more tightly managed green logistics processes related to the environment, packaging issues, especially the management of reverse logistics processes (i.e., recycling and product recovery processes). This is a collective effort of Vietnam's logistics industry with the cooperation of manufacturers to create a supply chain from production to consumers. With this cooperation, it is evident that the green transition is currently receiving great attention and is being adjusted by companies to strive for the Net Zero goal by 2050 as committed by the Government in COP26".

Sharing the same view, Mr. Le Duy Hiep - President of VLA added that globally, many large logistics enterprises such as shipping lines, port businesses... have had plans to reduce greenhouse gas emissions, transitioning to green energy earlier than the schedules committed by countries.

According to VLA, currently, the transport sector in general contributes 24% of global emissions. The journey towards green and quickly adaptable logistics will contribute to reducing carbon emissions of Vietnam's logistics industry specifically and the world in general; thereby strongly promoting the Vietnamese Government's commitment to the Net Zero journey.

"Developing a green supply chain is no longer a future story but must be now, it is no longer an option but a necessity. Developing a green supply chain is also the necessary change, closely linked to the goal of net-zero emissions", Mr. Hiep emphasized.

Green logistics: A journey full of challenges

Green logistics is still a relatively new concept. To promote green logistics for comprehensive and sustainable growth in Vietnam, besides understanding the essence and role of green logistics, it is also necessary to point out the challenges in greening the logistics sector for domestic businesses.

Sharing more with reporters on this issue, Mr. Le Quang Trung pointed out three challenges in implementing the green transition in the logistics industry:

Firstly, the difficulties related to regulations. Up to this point, although we aim to reduce carbon emissions and make activities more environmentally friendly, for the seaport system, maritime transport, or logistics in warehouses, it is currently only encouraged without specific regulations, policies for implementation, or specific support policies. This is the first difficulty in the implementation process.

The second issue is investment-related challenges. To implement the green transition, there must be investment because many equipment and load issues previously used fossil fuels like oil and coal. All conventional loads with high energy costs must gradually switch to environmentally friendly loads. This is not cheap, as special equipment is needed for engines to reduce emissions, which is costly to invest in.

Besides financial difficulties, market acceptance is also a significant challenge. In the green transition process, logistics costs may increase in a certain period, so the market needs to accept and accompany this. This challenge requires the support of the whole society and solutions for phased investment towards the green transition goal.

Solutions to promote businesses towards green logistics development

To address difficulties and promote green logistics, Mr. Nguyen Quang Vinh shared with reporters: "The Government needs to consider more policies to encourage and promote businesses towards green logistics development, especially small and medium enterprises. For example, there should be tax incentive mechanisms, creating motivation and reducing costs for businesses, encouraging the use of alternative energy sources in road transport, encouraging changes in transport modes according to the multimodal transport model, establishing carbon credits to protect and control greenhouse gas emissions…

Secondly, mainly Vietnamese enterprises are small and medium enterprises (accounting for 98%), so there needs to be more information exchange and support for businesses like capacity building, green management skills, so that businesses can better implement".

Mr. Vinh also informed that one of the tools that businesses can use easily and effectively is the Corporate Sustainability Index developed by VCCI in collaboration with various ministries. "We have developed this index to spread it to the business community. Currently, Vietnamese enterprises from all economic sectors, from multinational corporations to small, micro-enterprises can utilize this index. It includes many measurable indicators of the greenness of enterprises. If we strive well with these indicators, it will be very beneficial for businesses in the green transition process", Mr. Vinh said.

At the seminar, Mr. Tran Thanh Hai - Deputy Director of the Import-Export Department, Ministry of Industry and Trade also suggested that the green transition in the logistics industry needs to focus on energy transition for vehicles. Currently, small passenger transport vehicles have started transitioning to renewable energy, but large freight transport vehicles have not yet switched to renewable energy.

"Along with that, businesses need to find ways to save energy during operations; increase efficiency in working processes. This is also a factor contributing to enhancing rapid adaptation in the new context", Mr. Tran Thanh Hai shared.

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