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Vietnam must master the technology of the North-South high-speed railway, avoiding dependence on suppliers.

Investment in the North-South high-speed railway project must be carried out through technology transfer so that Vietnam can take control of the investment process and develop the domestic railway industry. According to delegate Hoang Van Cuong, "the selection of suppliers should not be concerned with which country, but with which technology should be chosen so that there are many competitive suppliers willing to transfer technology to Vietnam"...

Illustrative photo

Discussing the investment policy for the high-speed railway project on the North-South axis on the afternoon of November 20, 2024, delegates all agreed with the necessity of investing in the high-speed railway project on the North-South axis, opening up many potential opportunities and new development space.

According to delegate Hoang Van Cuong, the project to build a high-speed railway on the North-South axis, because it satisfies both necessary and sufficient conditions.

Specifically, the public debt ratio is quite low at 37%, which is a good place to mobilize an additional 67 billion USD within 10 years, while public debt will only increase to about 45% of GDP, lower than the allowable public debt ceiling of 60%. Vietnam has a long shape, the circulation of goods and the need to connect economic centers along the North-South economic corridor are very large, many areas have development potential but have not been exploited due to the bottleneck of high logistics costs.

Along with that, the scale of the economy is growing rapidly, so the demand for transporting goods along the North-South economic corridor in the future will be very large. We need to increase the circulation of export goods to the markets of Eastern Europe, the Middle East and North Asia, to reduce the level of concentration on some markets with potential risks as at present. Therefore, it is necessary to develop a high-speed North-South railway line that can connect with the railway network of countries in the region to solve the bottleneck of logistics and international connectivity.

NEED TO EXPLOIT DUAL-USE OF BOTH PASSENGERS AND GOODS
Although it is very necessary and feasible to invest, this is a very large investment project, important for long-term development and affects many areas of development of the country. Therefore, it needs to be evaluated very carefully, with a multi-dimensional perspective to choose the most suitable option.

Delegate Hoang Van Cuong said that the North-South high-speed railway must take on the dual-purpose function of transporting both passengers and goods (not just transporting goods when necessary).

Giving reasons, the delegate analyzed that the population concentration along the North-South route is only 1/10 of the Beijing-Shanghai route, and ½ of the Taipei-Kaohsiung route; so if it only carries passengers, it will waste about 50% of its capacity, and the revenue from only carrying passengers will not be enough to cover operating costs, and there is a risk of having to make huge losses like the Taipei-Kaohsiung route in Taiwan.

In addition, if there is no freight transport, it will not solve the logistics bottleneck, will not meet the demand for freight transport along the North-South economic corridor and will not be connected with the international railway system.

According to the delegate, the renovation of the existing railway line is a single track, so the number of trains will only increase by a maximum of 1.5 times compared to the present. The existing line has thousands of level crossings with residential roads, so it is impossible to increase the speed of trains compared to the present. Therefore, the increased freight transport capacity will not be much compared to the current capacity of about 1%.

In addition, the current railway line is a single track with a gauge of 1m, which will not be connected with the international freight transport system, which all use a gauge of 1m435, so it will increase the cost and time for transiting goods.

For the above reasons, the delegate emphasized that “the North-South high-speed railway must be designed and invested to exploit both passengers and goods, meet the demand for transporting goods along the North-South route, connect with the international intermodal transport system, attract and distribute investment resources to regions with great potential along the railway route; to maximize capacity, increase revenue, avoid having to compensate for losses...

TRANSFER AND MASTER HIGH-SPEED RAILWAY TECHNOLOGY
The Hanoi delegation also emphasized that investment in the North-South high-speed railway project must be carried out in the form of technology transfer so that Vietnam can master the investment process and develop the domestic railway industry”.

“The lessons learned from the three urban railway lines in Hanoi and Ho Chi Minh City, constructed by foreign contractors in a package, when the conditions are not met, the foreign contractors will stop the project and request contract penalties. In addition, the process of operation, repair, and replacement will depend forever on foreign suppliers”.

“If the North-South high-speed railway project continues to bid to select foreign suppliers as it did with the urban railway lines, not only will there be risks in terms of time and unknown completion date, capital may increase and more dangerously, there will be forever dependence on foreign suppliers”, delegate Hoang Van Cuong stated his opinion.

The lessons learned when Vietnam successfully deployed the construction of the 500KV line 3 with a lightning-fast completion time, is that due to mastering the technology and directly performing the construction, it can “overcome the sun, overcome the rain”, determined to complete according to the Prime Minister's requirements.

According to the delegate, if the North-South high-speed railway project is combined with the urban railway projects of Hanoi and Ho Chi Minh City, there will be a railway market share of about 150 billion USD. This is a large enough market to receive technology transfer from abroad so that domestic enterprises can produce and build themselves, and perhaps only buy a few very specific components. The delegate also believes that domestic enterprises have the capacity to receive railway technology transfer and continue to research, improve and develop further.

"If we can do that, we will not only have a North-South high-speed railway but our country will also develop its own railway industry," the delegate said.

The issue of mastering railway technology was also mentioned by many delegates. Delegate Duong Khac Mai, Dak Nong delegation, emphasized that this is an advanced, modern technology that only very few countries in the world have, while we have to acknowledge the fact that Vietnam is still backward in this field and many related supporting fields.

Delegate Hai Duong delegation also expressed interest in attracting domestic private investment, to help businesses have the opportunity to develop strongly, to be able to directly receive technology transfer from abroad to localize at the maximum level, thereby reducing dependence on foreign countries and being able to mobilize resources from the whole society to reduce pressure on the state budget. In addition, it is necessary to attract private enterprises to invest in the construction of stations and other support services...

Delegate Nguyen Ngoc Son, Hai Duong delegation, expressed the opinion that the Government has proposed rail technology, distributed power train technology with passenger trains, freight trains applying centralized power technology, and signal information applied like some countries. However, it is not clear which standard framework the technology follows and what is the localization rate?

Therefore, the delegate suggested that the Ministry of Transport should have a direction to choose modern technology but must ensure universality to enhance competitiveness in selecting partners to supply products and be ready to transfer technology to Vietnam. The industrial development project needs to develop a specific roadmap and resources to ensure that the transfer and reception of technology is consistent with the project progress.

Regarding the reception of technology transfer and human resource training, the project dossier has raised this issue, but in reality, technology transfer and human resource training are often associated with the process of project preparation, construction investment, and procurement of equipment and vehicles.

Therefore, according to the delegate, in the next phase, cost items related to technology transfer and human resource training need to be detailed, associated with the specific responsibilities of the project participants to ensure feasibility, synchronization, and meeting the short-term and long-term needs for human resources for this field in the overall development of human resources for emerging fields...

Commenting on this policy, delegate Tran Hoang Ngan, Ho Chi Minh City delegation, emphasized that this is a high-speed means of transport, so the technical requirements and safety level are extremely strict; do not focus on these requirements because of costs or revenue.

The delegate also noted that the project investment amount is very large (about 67 billion USD), it is necessary to focus on mobilizing domestic capital, foreign preferential loans, and limit the use of ODA capital. In addition, the construction and installation cost is about 50% (about 33 billion USD), so the delegate suggested that it is necessary to focus on using domestic materials, and at the same time, it is necessary to mobilize domestic enterprises with professional capacity to participate in this project.

In addition, it is necessary to organize the development of supporting industries and prepare human resources for high-speed railways as well as urban railways.

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