Private investors jump into railway projects
VietNamNet Bridge - Several railway development projects have attracted the interest of investors after the state called for funds from the private sector.

Vietnam, Vietnam Railway Corporation, private investors

The Vietnam Railway Corporation (VRC) and Indo Trans Logistics (ITL) in mid-September signed a contract on developing a logistics center at Yen Vien railway station in Hanoi.

Deputy Minister of Transport Nguyen Ngoc Dong said though the contract’s value is small with investment capital at just VND90 billion in 2015-2018, it still has important significance as it opens a new period of attracting private capital to the railway infrastructure sector.

Under the contract, VRC gave the concession to ITL to exploit the depot at Nam Yen Vien Station for 23 years, a mode of investment initiated by the Ministry of Transport recently which has been applied in aviation and maritime projects.

Local newspapers noted that this was the first time in many years that a VRC event was organized at one of the largest hotels in Hanoi.

The project is hoped to help change the way of cargo handling and management and give a push to the development of cargo transport by rail in the north.

VRC’s chair Tran Ngoc Thanh revealed that besides the Yen Vien project, VRC is laying the red carpet to welcome investors to depots at the stations in Lao Cai, Lang Son and Binh Duong provinces.

Meanwhile, Vingroup, a real estate giant developer, has sent word intimating that it wants to invest in the Hanoi, HCM City and Da Nang Railway stations.

Sources said a many investors are now queuing up for the right to invest in the Da Nang Station. These include joint enterprises of Duc Binh, Thanh Phong and Cienco 1, T&T Group, VIngroup and Nam Viet A Investment, Construction and Infrastructure Development.

The joint enterprises of ITD and IMP have shown their interest in the project on building the Hanoi – Hai Phong 1435 mm railway.

The enterprises in other business fields also can find their opportunities in railway projects. 

In late September, VRC and Vietnam Telecom signed an MOU on RailwayBox, the telco’s online service which allows passengers on trains to order food, drinks and entertainment services via mobile phones. 

Truong Van Phuoc, deputy chair of the National Finance Supervision Council, noted that giving concessions was a good solution to develop transport infrastructure in the context of limited state budget. 

Meanwhile, BOT investors (build-operate-transfer mode) now have to get bank loans at very high interest rates, which makes it costly to develop the projects.

However, state management agencies have been warned that investors may exploit the concession contracts for dubious purposes. 


Vietnam, Vietnam Railway Corporation, private investors