Central Vietnam province okays Hoa Phat's $393 mln railway track project

The Dung Quat Economic Zone and Quang Ngai Industrial Parks Authority on Tuesday gave in-principle approval to a $393 million rail track and special steel project by Hoa Phat Dung Quat Rail and Special Steel JSC, a subsidiary of steel giant Hoa Phat.

The project, with a designed annual capacity of 700,000 tons, will cover 14.79 hectares in the Eastern Industrial Park within the Dung Quat Economic Zone, located in Van Tuong commune, the central province of Quang Ngai.

Of the total investment, VND3.8 trillion ($144.92 million) will come from the investor's equity, and VND6.2 trillion will be raised through other means.

The project is granted a 50-year operational term, starting from the date the land is officially allocated or leased by the government.

From Q3/2025 to Q2/2026, the investor will complete all legal procedures, including compensation and site clearance. The plant is expected to be operational by Q3/2028.

The project will receive investment incentives and support in accordance with current Vietnamese laws.

The authority said the project's primary goal is to produce iron, steel, and related products under code 2410 in accordance with the Vietnam Standard Industrial Classification (VSIC) 2018.

It aims to address the urgent market demand for high-quality railway steel while aligning with the government’s broader strategy to promote domestic industrial and supporting sectors.

According to the authority, once operational, the project will meet the growing demand for railway steel in upcoming national projects such as the North-South high-speed railway; urban rail systems connecting Hanoi, Lao Cai, and Hai Phong; and other major infrastructure developments.

This will help improve transportation infrastructure, accommodate increasing cargo and passenger traffic, reduce import dependency, and lower logistics costs, it said.

Additionally, the project supports the synchronized development of Hoa Phat’s steel production ecosystem, securing raw material sources and contributing to the company's green steel roadmap, it added.

The project is expected to generate annual revenue of nearly VND11.44 trillion ($436.28 million), contribute an estimated VND149.7 billion in annual taxes to the local state budget, and create about 400 direct jobs, helping boost Quang Ngai’s GRDP and industrial output as well as the development of Vietnam’s steel industry in general.

Hoa Phat is currently the largest steel producer in Vietnam and among the top 50 largest steel companies in the world. The group has exported products to 40 countries and territories.

The group’s projects in the Dung Quat Economic Zone have created jobs for about 17,000 direct workers, more than 80% of whom are locals, as well as tens of thousands of workers from its contractors and partners.

Hoa Phat is listed on the Ho Chi Minh Stock Exchange (HoSE) as HPG, which closed Tuesday at VND25,350 ($0.97) per share.