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Defense Ministry approves of long-planned cargo airline

The Saigon Times

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HCMC – The Ministry of National Defense has thrown its support behind a plan to issue an air transport license to IPP Air Cargo JSC, whose chairman is billionaire Johnathan Hanh Nguyen, according to a dispatch recently sent to the Government Office.

Granting a license to the airline, which will specialize in cargo transport, will contribute to boosting the development of Vietnam’s logistics and is in line with the nation’s transport growth strategy, said the ministry.

The ministry gave the nod to allow the cargo airline to fly amid the post-pandemic recovery of the aviation sector, the local media reported.

The ministry proposed the Ministry of Transport closely work with the former to manage air traffic and airspace in line with the prevailing regulations after a license is issued to IIP Air Cargo to promote the socio-economic growth, and guarantee national security and safety.

The Government Office had earlier asked the ministries and agencies to give their feedback on a plan to license IPP Air Cargo JSC.

The Ministry of Transport said in a report sent to the prime minister in late March that the establishment of a new cargo airline was necessary as local air carriers’ inbound cargo transport accounted for a mere 18% of the market in 2019 and just 11% in the 2020-2021 period.

As many as 29 foreign airlines are transporting goods from 16 nations and territories to Vietnam. Over the past few months, the number of flights transporting passengers with an ancillary cargo transport service plunged, while demand for cargo transport was on the rise, pushing international airfares up by three or four times, or even six-fold from the pre-pandemic period.

The ministry, therefore, said that the establishment of IPP Air Cargo was expected to provide customers with new cargo transport service and bolster the country’s logistics sector.

After getting an air transport license, IPP Air Cargo will operate five aircraft in the first year of its operations. Five years later, the number of planes will double to 10.

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