Investing in 350 km/h high-speed railway is a burden for Vietnam's economy

Professor La Ngoc Khue - former Deputy Minister of Transport had discussions on this content.

Professor La Ngoc Khue, former Deputy Minister of Transport. Photo:Ba Do

- What do you think about the two options above?

- The plan of the Ministry of Transport was submitted by the Government to the National Assembly in June 2010 (not approved). At that time, the total investment of the project was nearly 56 billion USD, now the new study has increased it to 58.7 billion USD. This plan has a maximum design speed of 350 km/h, operating speed of 320 km/h and is only used for passenger transport; freight trains cannot be used.

The plan of the Ministry of Planning and Investment is a high-speed railway carrying both passengers and goods. This plan is shown in the relevant decisions of the Prime Minister in 2015, according to which high-speed trains are operated at a speed range of 160-200 km/h, with a design speed greater than 200 km/h.

Of the two options above, the 200 km/h railway is certainly cheaper because the total investment is higher as the train speed increases. For example, with a speed of over 300 km/h, according to TEDI (consultant), the upper-level architecture (from the concrete foundation to the rails) is estimated at 5.7 billion USD, and the signal information system is about 2 billion USD. In addition, purchasing vehicles is very expensive, the cost of a Shinkansen train is equivalent to an A320 aircraft.

- After many years of researching high-speed rail, which option do you support?

- I support the plan of the Ministry of Planning and Investment. Ministries and sectors should comply with the Prime Minister's previous decision to invest in high-speed railways in the operating range of 160-200 km/h to transport goods and passengers.

- Apart from the fact that the total investment will be lower, what other reasons make you support the Ministry of Planning and Investment's plan?

- If the high-speed railway is only for passengers, there will be a lot of excess capacity. According to TEDI's research, the 350 km/h railway can create a transport capacity of 364,000 people in a day and night. Meanwhile, it is forecasted that by 2050, the passenger traffic on the Hanoi - Vinh route will be 145,000 people, Vinh - Nha Trang 133,000 people, and Ho Chi Minh City - Nha Trang 155,000 people. Thus, this passenger traffic only fills 40% of the transport capacity of the 350 km/h railway; the remaining 60% of the capacity is wasted, while the demand for freight transport is not met. This is absurd and should not happen.

For many years, the 1m gauge railway has been like an "old buffalo" and cannot pull much cargo. There are only 8 pairs of freight trains per day, and the total annual cargo output does not exceed 2.5 million tons. This output is nothing compared to road transport.

Currently, road transport accounts for the majority of the market share, so according to World Bank statistics, Vietnam's logistics costs account for 21% of GDP, twice as high as Thailand's, making the cost of goods high and losing the competitiveness of the economy.

The situation will become more serious because Thailand is planning to build a high-speed railway network and turn Bangkok into a regional logistics hub, with goods from Malaysia and Thailand going directly from their countries to southwestern China. Meanwhile, Vietnamese goods will have difficulty being transported and cannot go deep into China due to different railway gauges.

There are also opinions that the current 1m line needs to be renovated to transport goods, but that would require a huge investment. To create a transport capacity that is competitive with roads, the current railway line must be elevated or have overpasses built to clear more than 4,000 level crossings. At the same time, the transport sector must build overpasses so that the railway can operate continuously during the rainy season; the land must be cleared to open a double track line and increase the track gauge to 1,435mm to be able to connect with the Chinese railway.

If we build a high-speed railway (350 km/h), the cost will be huge, putting a burden on the economy. Currently, the State invests more than one billion USD in the transport sector each year. If the total investment of the project is 58 billion USD, expected to be implemented in 30 years, then each year Vietnam needs nearly 2 billion USD to invest in the high-speed railway project. Should Vietnam postpone many other transport projects to give up resources for the high-speed railway?

On the other hand, from the fact that the construction of urban railways has a lower technical level than high-speed railways, which we have encountered difficulties in the past, it is certain that with high-speed railways, Vietnam is not yet capable of approaching, and will be completely dependent on foreign countries; inevitably, Vietnamese enterprises will be pushed out of the game.