EXPORTING GUIDE

Exporting to Vietnam 5%
The main buyers in Vietnam (which are nearby and take on the complexities of selling to far-away export markets) are (ADI,
2007):
• Vietnamese merchants buy products to re-export them;
• Malaysian, Singaporean and Chinese buyers for the export markets
• Vietnamese buyers who send on products for processing in Vietnam; especially low quality rubber which needs to be
remixed
There are three main channels for the export of palletized crumb rubber:
• through Vietnam via road to Saigon Port,
• through Phnom Penh Port,
• through Sihanoukville Port.
 Saigon Port
Route (2 legs) 1. Kampong Cham -‐Vietnam border
2. Vietnam border-‐Saigon Port
Preferred Route by Preferred export route (though more
expensive, USD34/ton).
Exporters
Proximity (from Proximity (nearer to the main
production areas than Sihanoukville or
production-area to port) Phnom Penh port)
and Transport Costs Lowest production-‐area to port
transport costs
Port Characteristics Saigon Port is much bigger than
Sihanoukville, served by larger ships, has
(loading operations) and more connections(mainly to Singapore
Shipping Costs and Hong Kong but also beyond), is
more efficient, and does not experience
the same amount of delays. Shipping
costs through Saigon Port are lower
than through Sihanoukville.
Phnom Penh Port Sihanoukville Port
1. Kampong Cham -‐Phnom Penh 1. Kampong Cham -‐Phnom Penh
2. Phnom Penh -‐Saigon Port 2. Phnom Penh -‐Sihanoukville
Not used by exporters (though cheaper, About same price (USD34/ton) as Saigon
USD28/ton). Port
The first leg (Kampong Cham to Phnom Penh)is by truck, never containerized and
often not on pallets. Cost are around USD6/ton plus an additional USD6/ton of
hidden expenses.
The second leg (Phnom Penh to Sihanoukville)can be undertaken by road (6to
7hours)or rail(12hours,with an irregular timetable).Road costs are USD22 per ton,
including customs clearance and loading on ship. Containerized rubber is 30percent
more expensive than the merchandise bulk-‐loaded on trucks. Road transport costs
30percent more than rail. In both cases, the rubber has to be re-‐loaded into
containers if these must be used
Restrictions on the draft of barges that Sihanoukville port is only one-‐tenth of
can arrive at Phnom Penh Port, because the size of Saigon port., translating into
of fluctuating levels of the river: 1,500 higher transport costs than from Saigon
tons or less (dry season) to 5,000 tons Port. As most of the rubber transits
(wet season) through Vietnam, the quantities
transiting through Sihanoukville are not
sufficient to allow for large discounts.
Discounts based on volume could
reduce transport costs from Kampong
Cham to Sihanoukville by half.
Procedures and Payments Straightforward procedures, and quick
methods of payment.
Complicated and long procedures. 90
day Letters of Credit need to be drafted
and guaranteed by a bank. Since most
exporters want immediate payment for
their goods due to cash flow shortages
they appear to be willing to take a
reduction in profit.
The two legs have to be arranged for
separately since there does not appear
to be a freight service from factory
(Kampong Cham) to port
(Sihanoukville).

Official Declarations and Overland transportation to Vietnam Shipment through Phnom Penh or Sihanoukville ports would more likely have to
entails possibility of informal exports be officially declared and the corresponding export tax paid through general
Export tax without full export tax. department of custom.