Vietnam Looks to Fund $56 Billion High-Speed System Between Hanoi and Ho Chi Minh City

Project requires help from international organizations such as the World Bank and the Asian Development Bank before it can get off the ground.

Vietnam Railways Corp announced today that it will use Japanese Shinkansen technology for its planned high-speed rail line between the capital Hanoi and Ho Chi Minh City. The 1,000-mi railway will replace a train line originally built during French colonial control, covering most of the country’s north-south length. Though the mammoth project has yet to be funded, Japanese train manufacturers took heart in the news as they begin their push into international markets such as the United States.

Hanoi and Ho Chi Mihn City are Vietnam’s two largest cities, and their metropolitan areas represent about 10% of the country’s population alone. The new railway would also provide fast access to major cities such as Vinh and Nha Trang, each on the country’s coast. The first phase of the project would run between Hue and Da Nang, located sixty miles apart and about halfway between the line’s two planned termini. This section is seen as the most profitable of the whole corridor since its short travel time would allow daily commuting. A full-distance trip between Hanoi and Ho Chi Minh City would take about 5 hours in ideal conditions — trains running between the two today need a full three days to do as much.

The relatively poor Vietnamese government will not be able to finance the project itself and is looking to Japan, the World Bank, and the Asian Development Bank for funds. If enough cash is identified, the system would be up and operating by 2020, though that timeline seems optimistic and Japan itself has argued that Vietnam wait until the mid-2030s or later to begin services.

One wonders whether Vietnam’s choice of Japanese train technology is more a reflection of the country’s desire for Japanese aid than an actual reflection of the advantages of Shinkansen. Nonetheless, this is big news for companies such as Kawasaki and Nippon Sharyo, whose operations have been confined to the domestic market until the recent opening of Taiwan’s high-speed rail. Some Chinese high-speed operations use Shinkansen technology as well.

European rivals have been quick to capitalize on investment in fast trains in Russia, China, Spain, Saudi Arabia, and Argentina, among other countries, leaving the Japanese companies behind on the international scene. Scoring the Vietnamese contract proves that they will be prepared for future competition worldwide and specifically in the potentially largest market, the United States, where Alstom, Siemens, Bombardier, and even Korean companies are already pushing their wares.

9 Comments | Leave a Reply »
  • Adam

    If countries like Burma are willing to make the investment, why are we so hesitant? Every time I read one of these posts I wonder where the heads of our elected officials are.

  • Ned

    Vietnam most likely selected Shinkansen technology because Japan is the countries largest donor. Construction would actually be a boon to Japanese contractors who would probably get the lion share of work.

  • EngineerScotty

    Busy kissing the posteriors of Big Oil, perhaps? :)

    It’s fair to point out that countries like Burma, Vietnam, and China don’t have the same political pressures being applied to them that the US government faces; where there is a significant port of the electorate which considers such projects a waste of Their Money. (And indeed, governments around the world routinely squander money on poorly-hatched ideas and/or outright self-dealing; though the same is true for private concerns).

  • Note by the way that the initial Delhi Metro was funded in part by Japanese aid, which went directly to Japanese companies to design and build the project. Signs expressing official gratitude to the Japanese government can be found in some Delhi Metro stations.

  • jon

    sadly theyll probably have it before the US

  • What does Burma have to do with anything?

  • Deacon

    Vietnam is planning this what does Burma have to do with it? Do they have a plan?

    “…the electorate which considers such projects a waste of Their Money…”

    Thats where they get it wrong, It’s not THEIR money, we pay their salaries. It’s our money that we give to them, through our screwed tax system, in the hopes of them improving our standard of living by way of investment in Better Infrastructure for one. Public Works Projects. Just another way of stimulating the economy.

    As we clearly see now, the electorate in general doesn’t want to do anything that resembles a long term investment because that would mean initiative and accountability would be a requirement.

  • Dean

    It would be somewhat ironic that a country which was blown into the stone age not so long ago will have better railways than the country which did the above.

  • Nguyen

    This is a great news for prosperity of Vietnam in the future, with a condition that finance and budgeting is somehow cleared. From a technological perspective, Shinkansen is far more superior compared to ICE or TGV, and would provide a stable and accident free operational infrastructure for Vietnam. It’s the only system in the world that allows operating average speed of 350 kmph or better even on a curved lines with 5-minute intervals between the trains. Not to mention the low energy consumption and greater axle load capacity per net power. Lot more people can be transferred with Shinkansen system per hour than with TGV.
    Technicality aside, Shinkansen would provide increased traffic between Ho Chi Minh and Hanoi and boost the economy and vitality of these cities significantly, without resorting to pollution inducing industrialization.

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