Vietnam-Thailand Direct Overland Trade Now Possible
Jun. 11 – Direct overland shipments between Vietnam and Thailand are now possible through a regional customs transit system that eliminates the need for re-loading in Lao PDR.
The direct route along the East-West Economic Corridor begins from Danang, Vietnam, passing through Savannakhet, Lao PDR then on to Thailand. This is the first time that commercial trucks from Thailand and Vietnam can enter each others’ territory directly to deliver and pick up trade goods.
The regional customs transit system allows for single-window and single-stop border inspections that will cut overland transport time and increase trade and tourism.
“Ten years after Laos, Thailand and Vietnam first agreed to ease cross-border traffic rules, the promise of that agreement is truly being realized,” said Arjun Thapan, Director General of Asian Development Bank’s (ADB) Southeast Asia Department in a statement.
“Narrow dirt trails that were once used to transport refugees and military hardware have given way to modern highways carrying electronic goods, exotic fruits and tourists,” added Mr. Thapan.
So far, 1,200 permits for commercial vehicles have been issued or 400 permits for each participating country.
The Cross Border Transport Agreement allows that specific goods be classified as “low risk” and fast-tracked at border-crossing check points. This should cut down on theft and damage caused by unloading and reloading at the border.
The East-West Economic Corridor has been supported by funding from ADB through a US$57 million concessional loan in 1999, to upgrade roads in Vietnam and Lao PDR.
“Building international-standard roads was an important start, but not enough by itself,” said Mr. Thapan. “Governments also had to slash the bureaucratic red tape that restricted the cross-border flow of goods and people.”
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