Chinese conglomerates eye railway expansion in Vietnam

Leaders of China Railway Engineering Corporation (CREC) and Power China expressed their wish to develop railway projects in Vietnam while meeting with Vietnamese Prime Minister Pham Minh Chinh in Nanning city, Guangxi province on Saturday.

Chairman of China Railway Chen Yun Chen said the corporation would like to engage in the construction of railways in Vietnam, notably the Lao Cai-Hanoi-Hai Phong route linking with the Kunming-Hanoi-Hai Phong economic corridor.

Hanoi is about 120 km from Hai Phong city and 280 km from the northern mountainous province of Lao Cai, home to the famous resort town of Sa Pa.

China Railway has 381 branches in 105 countries. In Vietnam, it was the main contractor for the Cat Linh-Ha Dong metro line in Hanoi with an EPC contract valued at $640 million. It has also invested $18.1 million in a wind power project in Dak Nong province, and $5 million in a tire manufacturing plant in Tien Giang province, Chen Yun Chen added.

PM Chinh said Vietnam is promoting public-private partnerships in transport infrastructure development, striving to have 5,000 kilometers of expressways, complete the first stage of the Long Thanh International Airport in the southern province of Dong Nai, and build 1,700 kilometers of coastal roads from Quang Ninh to Ca Mau by 2030.

Quang Ninh in the northern region is home to UNESCO heritage site Ha Long Bay, while Ca Mau province lies in the southernmost part of Vietnam.

Vietnam plans to build railways including the 388-kilometer Lao Cai-Hanoi-Hai Phong line at a cost of $11 billion, the Vung Ang-Laos route with the section in Vietnam stretching 103 kilometers and costing $1.6 billion, and the 1,545-kilometer Hanoi-Ho Chi Minh City (North-South) high speed route with investment of $62 billion, the Prime Minister noted.

Chinh, who is in China for the 20th China-ASEAN Expo (CAEXPO) and China-ASEAN Business and Investment Summit (CABIS), asked Chinese enterprises and China Railway in particular to expand their operations in Vietnam in the spirit of harmonizing interests and sharing risks.

He suggested China Railway continue working with relevant Vietnamese ministries and localities to develop new projects in Vietnam, including the Lao Cai-Hanoi-Hai Phong line.

Meanwhile, Wang Xiaojun, deputy general manager of Power China, which ranked 100th on the Fortune Global 500 list and 29th among the top 500 Chinese enterprises in 2022, said his corporation plans to invest in power and infrastructure construction projects in Vietnam, including high-speed railways.

PM Chinh applauded Power China's plan and asked the group to discuss with Vietnamese authorities to find a feasible option to start immediately.

The Vietnamese government commits to creating all possible support to Chinese firms and Power China in particular, he said, adding that it recently approved the National Power Development Plan (PDP VIII) for the 2021-2030 period with a vision to 2050, with renewable energy sources, especially onshore and offshore wind power, as the foundation of Vietnam's long-term energy security.

He suggested that Power China explore cooperation in Vietnam's priority areas, including infrastructure - one of Vietnam's three strategic breakthroughs. Specifically, he proposed exploring the possibility of investing in the China-Quang Ninh-Hai Phong and Lang Son-Hanoi-Hai Phong rail lines.

Power China entered the Vietnamese market in 2000, engaging in the construction of the Lai Chau and Son La hydropower projects in the north and the Vinh Tan coastal thermal power plant in the south-central province of Binh Thuan. It is the main contractor of wind and solar power projects in Vietnam with a total capacity of 7 GW. The total contract value of the above projects has reached more than $6.5 billion.

Meeting Secretary of the Guangxi Party Committee Liu Ning the same day, Prime Minister Chinh called on localities from both sides to increase rail and road infrastructure connectivity to boost economic cooperation.

Expressing satisfaction with two-way trade exceeding $20 billion in the first eight months of this year, Chinh spoke highly of bilateral cooperation potential and outlined six breakthrough areas for cooperation with Guangxi, namely infrastructure connectivity, economic-trade-investment cooperation promotion, people-to-people and youth exchange expansion, close cooperation in the field of border gates, good implementation of three documents on the management of the Vietnam-China land border, and close cooperation in education and training.

In response, Liu Ning promised to work with Vietnamese ministries, agencies and localities to deepen collaboration in six breakthrough directions proposed by the Vietnamese leader, with a focus on expanding rail and road connectivity, improving customs efficiency through the pilot "smart border gate" model, strengthening port cooperation, and jointly working on cross-border crime prevention.