After nearly 20 years of research, the proposal for the North-South high-speed rail project has once again been submitted to the National Assembly for approval during the 8th session of the 15th legislature.  

Previously, the Central Committee of the 13th Party Congress, the Politburo, and the Government had unanimously agreed on the project, urging the mobilization of all resources for its implementation.  

With increasing transport demand, a projected economic scale of $430 billion by 2030 - nearly triple that of 2010 - and a low public debt ratio of approximately 37% of GDP, the timing is seen as optimal for construction to proceed.  

The project is scheduled to begin in 2027 and complete by 2035, spanning 1,541 kilometers. Designed for speeds of 350 km/h, the rail will reduce travel time from Hanoi to Ho Chi Minh City to just 5.5 hours - six times faster than conventional trains.

In 2007, the government approved a list of essential transport infrastructure projects, including the North-South high-speed rail. Vietnam Railways (VNR) was tasked with the project, with the Vietnam-Japan Consulting Consortium (VJC) conducting a feasibility study from 2008 to 2009.  

In May 2010, the project was presented to the National Assembly with a proposal to construct a 1,570-kilometer dual-track railway for passenger transport at 350 km/h. The estimated cost was $55.8 billion, with construction planned in two phases:  

1. Hanoi-Vinh and Nha Trang-Ho Chi Minh City (2012–2020).  

2. Completion of the entire line by 2035.  

 

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Laos high-speed railway. Photo credit: Hoang Ha

At the time, concerns about speed, operational plans, and funding loomed large. Vietnam’s economy had just escaped poverty, and public debt was high at 56.6% of GDP. The investment - nearly half of GDP - was seen as daunting.  

As a result, only 185 of 439 attending National Assembly members voted in favor, while 34 abstained, leading to the project's rejection and postponement.  

Fourteen years after the initial rejection, the North-South high-speed rail project has been revisited, with officials deeming now the "right time" to move forward.  

On November 13, 2024, during the 8th session of the National Assembly, Minister of Transport Nguyen Van Thang formally presented the project for investment approval.  

The rail line will stretch 1,541 kilometers from Ngoc Hoi Station in Hanoi to Thu Thiem Station in Ho Chi Minh City, traversing 20 provinces and cities. With a design speed of 350 km/h, the project’s cost is projected at over $67 billion, to be funded from state budget allocations in medium-term public investment plans.  

Construction is expected to be completed by 2035, with funding distributed over 12 years, averaging $5.6 billion annually.  

Deputy Chair of the National Assembly’s Finance and Budget Committee, Pham Thuy Chinh, remarked that many lawmakers from the 12th legislature regret not approving the project in 2010, when its estimated cost was $56 billion.  

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Prof. Dr. Hoang Van Cuong, Member of the National Assembly's Finance and Budget Committee.
Photo credit: Hoang Ha.

“Now the cost has risen to $67 billion, and we’ve missed the chance to develop our railway industry. Further delay is no longer an option,” she stated.  

Deputy Minister of Transport Nguyen Danh Huy highlighted that the project is a response to pressing transport needs. Studies over 18 years have shown that the North-South corridor has the greatest demand for passenger and freight transport.  

“This project is pivotal for restructuring transport shares and serves as a cornerstone for Vietnam’s leap into a new era of growth,” Deputy Minister Huy said.  

Minister of Transport Nguyen Van Thang noted that Vietnam’s current economic scale ($430 billion in 2023) and public debt level (37% of GDP) provide a solid foundation for financing the project.  

Despite being Vietnam’s largest-ever public investment, funding plans are seen as manageable.  

Proposed funding sources:  

1. State Budget: Central government funds will play a primary role, supplemented by local budgets.  

2. Government Bonds: Issuing long-term bonds with favorable interest rates tied to market conditions.  

3. Public-Private Partnerships: Engaging domestic investors for resource mobilization.  

4. Foreign Loans: Seeking loans with preferential terms and minimal restrictions.  

National Assembly Finance and Budget Committee member, Prof. Dr. Hoang Van Cuong, stressed the need to ensure uninterrupted funding.  

“We should consider increasing public debt, issuing government bonds domestically, and even internationally to secure resources for this project,” Cuong suggested.  

Minister Thang affirmed that domestic funding would be prioritized. If foreign loans are used, they must be more affordable and come with no restrictive conditions to ensure technological and operational independence.  

N. Huyen