Domestic ships still prefer to fly foreign flags.

In recent years, Vietnamese shipowners have been expanding their fleets, investing in more large-tonnage vessels.

However, the proportion of foreign-flagged vessels owned by Vietnamese shipowners is trending sharply upward. This both reduces competitiveness and makes it difficult to improve the domestic fleet.

Ships flying foreign flags are mostly large in size.

In early 2025, Vietnam Maritime Transport Corporation (Vosco) officially took delivery of the Dai Quang oil/chemical tanker, with a deadweight tonnage of approximately 13,500 DWT, in Singapore.

The new vessel increases Vosco's fleet to 14 ships with a total deadweight tonnage of 447,174 DWT. Notably, the new ship is flying the Panamanian flag for convenient operation on international routes.

To attract businesses to register ships flying the Vietnamese flag, many solutions are needed, including tax and financial incentives.

Previously, in 2024, Hai An Transport and Stevedoring Joint Stock Company completed a project to build four new container ships with a capacity of 1,800 TEUs. Of these, two ships fly the Vietnamese flag and two ships fly foreign flags.

Also that year, Hai An completed the investment in a Toro container ship (built in 2007) with a capacity of 3,400 TEUs, flying the Panamanian flag and chartered overseas.

In fact, many Vietnamese shipowners are gradually expanding their fleets and increasing their competitiveness. However, not a few shipowners have decided to fly foreign flags.

According to statistics from the Vietnam Maritime and Inland Waterways Administration, the proportion of foreign-flagged vessels owned by Vietnamese shipowners has been steadily increasing over the years. Foreign-flagged vessels accounted for 17% of the total Vietnamese-flagged fleet in 2021 and rose to 22% in 2023.

In terms of tonnage, in 2021, ships flying foreign flags accounted for 31% of the national fleet's total tonnage, while in 2023, this figure increased to 45%. The majority of ships flying foreign flags are large vessels serving international transport.

Financial incentives are needed.

Explaining this, Mr. Hoang Hong Giang, Deputy Director of the Vietnam Maritime and Inland Waterways Administration, said that according to current regulations on the purchase and construction of ships, businesses that purchase foreign ships older than 15 years will not be eligible to register the ships in Vietnam.

At the same time, many ship owners buy ships and fly them under foreign flags because they don't have to go through import procedures, reducing taxes and fees. Many foreign cargo owners also require ships to fly foreign flags for easier operation on international routes.

According to experts, not all businesses have the resources to buy a ship outright, so they may opt for lease-purchase. Therefore, in some cases, foreign flags must be flown according to the contract to make it easier for ship owners to manage the vessels.

Mr. Tran Manh Ha, Deputy Secretary General of the Vietnam Shipowners Association, said that the State always encourages shipowners to fly the Vietnamese flag on their ships to increase the tonnage of the national fleet.

However, registering a ship flying the Vietnamese flag requires many factors. "Most importantly, there must be preferential financial policies for ship owners," Mr. Ha said.

Proposal to revise the age limit for ships.

According to Mr. Nguyen Dai Hai, Deputy Director of Tancang Shipping Joint Stock Company, investing in purchasing ships requires a very large amount of capital, and businesses often have to borrow from banks.

However, loans in VND always have high interest rates above 10%, while loans in USD are only 2-4%. If VND loans had the same preferential rates as USD loans, Vietnamese businesses would have a competitive advantage in utilizing international infrastructure to generate profits.

In addition, the imposition of an 8% VAT tax (previously 10%) when businesses register ships flying the Vietnamese flag is also one of the reasons why many domestic ship owners are reluctant to register.

"This VAT tax accounts for 20-30% of the profit for a project to purchase and operate ships for 7 years. In reality, businesses can deduct the VAT tax, but the process takes a very long time, affecting the company's cash flow," Mr. Hai shared, adding that when processing the import of ships, they also have to bring the ships to a Vietnamese port.

This causes significant losses for shipowners because the import procedures take a long time, while shipowners operate not only in the Vietnamese market but also worldwide .

According to Mr. Hai, many countries such as Panama, Liberia, and Valletta have powerful fleets thanks to regulations that are favorable to foreign ships flying their flags. If Vietnam has suitable regulations, it will enhance its national fleet and may also attract more foreign ships.

One of the immediate issues that needs to be amended is the removal of the age limit for vessels registered in Vietnam, or an increase in the age limit to 20 years.

According to current regulations, the age of used foreign-flagged ships, submarines, submersibles, floating storage facilities, and mobile platforms registered in Vietnam must not exceed 10 years for passenger ships, submarines, and submersibles; and not exceed 15 years for other types of ships, floating storage facilities, and mobile platforms.

"If the regulations remain as they are now, not many businesses will be able to invest in new, modern ships," Mr. Hai said.

Currently, the Vietnam Maritime and Inland Waterways Administration is implementing a project to develop Vietnam's maritime fleet.

According to the plan, during the period 2026-2030, a suitable maritime transport management model will be developed to improve state management of maritime affairs in the field of maritime transport and maritime services. This includes further refining policies and legal documents in accordance with international treaties to which Vietnam has recently joined or is a member.

Specifically, import duties will continue to be waived and tonnage fees reduced by 50% for shipowners purchasing and operating container ships of 1,500 TEUs or more, or ships powered by clean energy sources such as LNG, H2, etc., and LNG carriers, until the end of 2030.

Source: https://www.baogiaothong.vn/tau-noi-van-sinh-treo-co-ngoai-192250317231425563.htm