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Have you ever pondered over the astounding growth and development that Vietnam has accomplished in recent times? If so, the credit can be attributed to its impressive transportation infrastructure. Be it airports, seaports, railways, roads, or highways, Vietnam has made significant investments to enhance its transportation networks. With an economy flourishing on the pillars of domestic demand, foreign investment, and exports, delving into this topic seems all the more pertinent. Therefore, let’s delve deeper into the current state and future plans for Vietnam’s transportation infrastructure. 

1. Vietnam’s transportation infrastructure overview

Vietnam’s transportation infrastructure has undergone a dramatic transformation in recent years, with the government making substantial investments to improve the country’s transportation network. This investment has been a vital part of the government’s strategy to boost the country’s economic growth, with a significant portion of the budget being allocated to infrastructure spending. 

The numbers speak for themselves: as of 2022, Vietnam’s infrastructure spending stands at an impressive 6% of its GDP. This represents a significant increase from the 2.6% of GDP that was spent on infrastructure back in 2016. These investments have yielded significant benefits for the economy, enabling businesses to transport goods and people more efficiently, reducing costs, and increasing competitiveness. 

To achieve this progress, Vietnam has invested heavily in transportation, especially in roads, airports, and seaports. The country’s public and private investment in infrastructure has reached 5.7% of GDP in recent years, the highest in Southeast Asia and the second highest in Asia after China (6.8% of GDP). This investment in infrastructure development is beneficial on two fronts: firstly, it satisfies the requirements for investment projects, and secondly, it creates higher economic growth and more employment. 

Based on the World Economic Forum Global Competitiveness Report 2019, Vietnam’s overall quality of infrastructure ranks at 77th out of 141 countries, with 66th in transport infrastructure and 87th in utility infrastructure. 

Rapid urbanization in Vietnam is a significant factor in driving the development of the transport and utilities sector. With approximately 50% of the population now living in major cities, the rising population has exceeded the capacity of the existing connectivity networks and utility systems. As a result, improving transportation infrastructure has become an even more critical priority for Vietnam’s government to ensure sustained economic growth and development. 

Transport Infrastructure in Vietnam

2. Vietnam’s Efforts to Modernize Transport System: Achievements and Challenges 

A. Transportation infrastructure investment for each sector 

Transport Infrastructure in Vietnam

B. Highlight Projects Completed in 2022 

The Ministry of Transport (MOT) stated that 21 crucial transportation projects of the country were completed in 2022, including 3 key projects: 

  • The North-South Expressway section from Cam Lo to La Son: The project has a total length of 98.3 km, with 37.3 km in Quang Tri province and 61 km in Thua Thien Hue province. The total investment in the project is over USD 324 million. The project started in 2019, and the main route was put into operation on December 31st, 2022. 
  • Trung Luong – My Thuan Expressway: The 51 km long expressway connects with the Ho Chi Minh City – Trung Luong Expressway at Than Cuu Nghia intersection (Chau Thanh district, Tien Giang), passing through 5 districts of Tien Giang and connecting with My Thuan 2 bridge under construction. This is one of the arterial roads to help reduce the load on National Highway 1A, connecting the Southwest region with Ho Chi Minh City. The project had an initial capital of over USD 595.42 million in BOT form, but after various changes of investors and management agencies, the total investment amounted to more than USD 510.36 million. 
  • Lach Huyen International Gateway Port in Hai Phong: the first deep-water port in northern Vietnam was started in October 2019 and completed in December 2022. The project has an investment scale of about USD 381 million and is capable of receiving container ships up to 12,000 Teus or up to 18,000 Teus. The project is expected to promote trade and investment in the region and reduce logistics costs for import and export. 

In addition to the above projects, a series of 18 projects to renovate and upgrade national highways have also been completed.  

C. Challenges Ahead 

However, there are current remaining challenges that need to be addressed for Vietnam’s transport Infrastructure.  

Currently, there has not been a seamless integration among the transportation infrastructure modes. This situation can negatively impact transport efficiency, increase traffic congestion and reduce competitiveness with global markets.  

Another challenge that Vietnam authorities need to take into consideration is the upgrading of the transportation system in all 5 aspects. With the rapid increase in tourism and logistics demand, the top concerns from investors are enhancement of capacity, operational efficiency, safety qualifications, modernization and materials quality 

The Vietnam government and authorities are making significant improvements to solve the existing challenges. Proposals have been made in order to upgrade and elevate the transportation infrastructure across Vietnam.  

3. Master plan of transportation infrastructure in upcoming years 

A. Vietnam’s transport infrastructure Master Plan 

Vietnam’s transport ministry announced its master plan for the country’s transportation infrastructure in April 2021. Its projected cost ranges from USD 43 billion to USD 65 billion between now and 2030. 

To provide appropriate infrastructure and maintain the economy’s rapid growth, the state is playing catch-up. Vietnam will construct tens of thousands of kilometers of new expressways, high-speed rail lines, deepwater ports, and international airports as part of the master plan. Vietnam’s plan is following the similar development model that high-income nations accomplished, including Singapore, Taiwan and South Korea.  

B. The 3 proposals that The Development and Strategy Insitute developed to implement in the master plan. 

  • First proposal includes the government will construct 5,000km of expressways and the largest Airport in Vietnam called Long Thanh International Airport, which is in Dong Nai Province. Another project, which is the first public-private partnership project of Vietnam and Japan Lach Huyen deep-water port in Hai Phong, will also be completed. The initial plan also calls for building two high-speed railways connecting Ho Chi Minh City (HCMC) and Nha Trang and Hanoi and Vinh. 
  • Second proposal related to 5000km expressways and high-speed railways to link provines to the Lach Huyen Port will be completed. In addition, the construction to expand HCMC’s Tan Son Nhat airport, Dien Bien airport and Con Dao airport, along with the completion of Long Thanh airport are expected. Along with the airport expansion, the waterways in both South and North regions are upgraded to connect domestically.  
  • Third proposal includes more trains in various locations around Vietnam, the plan includes many of the projects from the initial proposal. It is expected to cost the most in comparison with other proposals.

C. Trends and Opportunities   

Vietnam’s Master Plan for Transportation Development 2021-2030 identifies several trends and opportunities for the development of transportation infrastructure in the upcoming years. These initiatives can help improve Vietnam’s transportation system and promote economic development in the country. 

Here are some opportunities that are identified accordingly:  

  • Expansion of transportation infrastructure: The plan includes the construction of new airports, seaports, and highways, and the expansion of existing ones, to improve connectivity within Vietnam and with other countries in the region. 
  • Development of high-speed railways: Construction of several high-speed railway lines, including the North-South high-speed railway and the Ho Chi Minh City-Can Tho high-speed railway that connect major cities. 
  • Shift towards sustainable transportation: The plan includes the promotion of clean transportation technologies and the development of public transportation systems in urban areas. 
  • Promotion of private sector participation: Incentives and legal framework are made to encourage private sector investment. The plan includes the establishment of public-private partnerships (PPP). 

4. Final thoughts 

Vietnam’s infrastructure system will continue to grow significantly and become a developed area in comparison to other parts of the country with the help of foreign allies, the whole political system, and locals. However, there is still much work to be done. The country’s efforts to improve its transport system are commendable, and it is clear that the government is committed to achieving its goals. With continued investment and careful planning, Vietnam can realize its vision of a modern, sustainable, and efficient transport system that will benefit the country and its people for years to come.