‘Nameless expenses’ drive up the cost of Vietnam’s products

VietNamNet Bridge – Enterprises estimate that the miscellaneous and unvoucherable costs they must pay to get the job done increase production costs  by three percent.

Hundreds of fees . . .

The head of the import-export division of a joint venture in HCM City related that the finance director, an expat, said ‘no’ to the estimates submitted by his division. The problem was that the estimates included provision for  ‘nameless expenses’ — items for which the company would never get bills or vouchers.

Subsequently the finance director, after consulting with a friend, another expat who is working for a shipping firm, OK’d the estimates, agreeing to legitimize the nameless expenses.

Truckers say nameless expenses now account for 20 percent of the total transport cost enterprises have to pay. The legitimate cost of moving a container from HCM City to a nearby province is several hundred thousand dong.  This does not include the money drivers have to pay to purchase more fuel in case they get stuck in the traffic jam.

Nor does it include the unofficial fees they must pay at the ports.  There are lots of port fees; owners of goods don’t care much about the official fees set by the port developers.  What causes headaches is ‘nameless fees’.

A container truck driver for a transport firm in HCM City, said that drivers all must pay ‘lubricating fee’ to the staff at the ports. “They get paid for their jobs, but we still must grease their palms if we want things to go smoothly,” the driver said.

Meanwhile, the director of a freight and forwarding company calculates that ‘nameless fees’ add twenty to thirty percent to the cost of getting a container in or out of port, raising the total cost to about 4-5 million dong per container.

. . . burdening businesses

Companies that import materials for domestic production seem to suffer most from the nameless fees.

“Each of our containers is valued at 200 million dong, and on each we have to pay five to seven million dong for nameless fees,” said the director of an enterprise in HCM City.

The director of a food processing company estimates that the unreasonable, unvoucherable fees account for three percent of total cost, reducing Vietnam’s export competitivity vis-à-vis goods made in China.

Vu, staff of a fruit export company in HCM City, said that his company must to pay 10 million dong in service fees for every container – seven percent of the value of the fruit within.  Generally, companies expect nameless fees to account for less — 2.5 percent of the value of every container of exports – but even a one percent price increase could persuade an importer to reconsider whether to source products from Vietnam.

VietNamNet/TT

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Tags: Hcm City, In Hcm City, Lsquo Nameless, Million Dong, Nameless Expenses, Nameless Fees, Physics games

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