Construction giant Deoca to jointly build railway linking Vietnam, Laos, China

Vietnam’s Deoca Group and Laos’ Petroleum Trading Lao Holding (PTL) will cooperate to build the Vietnam-Laos railway, which will connect with the Laos-China railway and facilitate trade activities across the region, Deoca announced Wednesday.

According to the joint venture agreement signed between Deoca and PTL on Monday, the 554.7-kilometer Vietnam-Laos railway will link the former’s Vung Ang seaport and the latter’s capital Vientiane.

The project in public-private partnership (PPP) format has an investment of VND149,550 billion ($6.3 billion). The double-track railway will follow the standard track gauge of 1,434 millimeters and will have a speed of 150 kph.

The 103-kilometer Vietnam section of the railway, connecting Vung Ang seaport in the central province of Ha Tinh and Mu Gia pass in the central province of Quang Binh, has an investment of VND27,485 billion ($1.16 billion) and is suggested to follow the PPP format.

Deoca and PTL will report to their respective governments to implement the signed agreement, said Deoca Chairman Ho Minh Hoang.

The Vientiane end is expected to boost goods transportation to the northern region of Laos and the southern region of China. Meanwhile, the Vung Ang seaport, also the closest seaport to landlocked Laos, can enhance trade activities between the two countries and further to Thailand, China, Japan, and South Korea.

Trade between Vietnam and Laos grew 24% year-on-year to $1.7 billion in 2022, according to customs data. Of this, Vietnam exported goods worth $656.4 million to the western neighbor, up 10.4%; and spent $1.05 billion on importing from Laos, up 34.6%.