Vietnam’s new high-speed Reunification Express proposed for $26 billion

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Vietnam’s New High-speed Reunification Express Will Cost $26 Billion

Vietnam’s ministry of planning and investment has presented a new concept for the country’s planned north-south high-speed railway along the route of the Thong Nhat (Reunification) Express at an investment of $26 billion, as opposed to an earlier proposal by the ministry of transport of $58.7 billion.

Construction of the high-speed railway, which would allow passengers to travel between Vietnam’s capital Hanoi and the southern business hub of Ho Chi Minh City in about eight and a half hours over some 1,700 kilometers – in contrast to the current travel time of between 33 and 36 hours –, would be undertaken under a public-private partnership model, with 80 per cent of the investment allocated from the state budget and the rest funded by the private sector.

Citing experts from Germany and the Netherlands, the ministry of planning and investment said the railway, running at a speed of 200 km/h, would be “cost-effective,” Vietnam News reported.

The previous plan would have allowed trains to run at 320 km/h, with the tentative investment of some $58.7 billion over 30 years from 2020 to 2050. This would have reduced travel time to around 5.3 hours. However, critics in the government said the massive investment would have placed a burden on Vietnam’s economy since it was 50 times higher than the total state funding for transport infrastructure development in one fiscal year.

The project would start with two routes in the first phase, one connecting Hanoi with Vinh and another Nha Trang with Ho Chi Minh City and, when approved, would be expected to become operational in 2032. These two routes would be able to carry 364,000 passengers a day. The total number of daily passengers on both routes, however, is predicted to reach just 55,000 to 58,000 in the beginning, only 16 per cent of the capacity.

In a next step, Vietnamese Prime Minister Nguyen Xuan Phuc has to approve the north-south high-speed plan, and the country’s top legislature will vote on whether it will move forward or not.

Observers have pointed out that the high-speed train might be welcomed by regional commuters and tourists, but will have a hard time to compete with already three budget airlines – VietJet, Jetstar and Bamboo Airways – operating on the Ho Chi Minh City-Hanoi route for as little as around $60 (one way) at a flight time of two hours and ten minutes, and connecting all major cities in between as well.

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Vietnam’s ministry of planning and investment has presented a new concept for the country’s planned north-south high-speed railway along the route of the Thong Nhat (Reunification) Express at an investment of $26 billion, as opposed to an earlier proposal by the ministry of transport of $58.7 billion. Construction of the high-speed railway, which would allow passengers to travel between Vietnam’s capital Hanoi and the southern business hub of Ho Chi Minh City in about eight and a half hours over some 1,700 kilometers – in contrast to the current travel time of between 33 and 36 hours –, would be...

Reading Time: 2 minutes

Vietnam’s New High-speed Reunification Express Will Cost $26 Billion

Vietnam’s ministry of planning and investment has presented a new concept for the country’s planned north-south high-speed railway along the route of the Thong Nhat (Reunification) Express at an investment of $26 billion, as opposed to an earlier proposal by the ministry of transport of $58.7 billion.

Construction of the high-speed railway, which would allow passengers to travel between Vietnam’s capital Hanoi and the southern business hub of Ho Chi Minh City in about eight and a half hours over some 1,700 kilometers – in contrast to the current travel time of between 33 and 36 hours –, would be undertaken under a public-private partnership model, with 80 per cent of the investment allocated from the state budget and the rest funded by the private sector.

Citing experts from Germany and the Netherlands, the ministry of planning and investment said the railway, running at a speed of 200 km/h, would be “cost-effective,” Vietnam News reported.

The previous plan would have allowed trains to run at 320 km/h, with the tentative investment of some $58.7 billion over 30 years from 2020 to 2050. This would have reduced travel time to around 5.3 hours. However, critics in the government said the massive investment would have placed a burden on Vietnam’s economy since it was 50 times higher than the total state funding for transport infrastructure development in one fiscal year.

The project would start with two routes in the first phase, one connecting Hanoi with Vinh and another Nha Trang with Ho Chi Minh City and, when approved, would be expected to become operational in 2032. These two routes would be able to carry 364,000 passengers a day. The total number of daily passengers on both routes, however, is predicted to reach just 55,000 to 58,000 in the beginning, only 16 per cent of the capacity.

In a next step, Vietnamese Prime Minister Nguyen Xuan Phuc has to approve the north-south high-speed plan, and the country’s top legislature will vote on whether it will move forward or not.

Observers have pointed out that the high-speed train might be welcomed by regional commuters and tourists, but will have a hard time to compete with already three budget airlines – VietJet, Jetstar and Bamboo Airways – operating on the Ho Chi Minh City-Hanoi route for as little as around $60 (one way) at a flight time of two hours and ten minutes, and connecting all major cities in between as well.

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