Vietnam aims to start building two high-speed railway lines, costing US $11 billion, to link its capital, Hanoi, with China before 2030, as the massive timber trade between the two neighbours increases every month.
China is among the leading five consumers of Vietnamese wood and wood products and imports, accounting for 10% and 12% of Vietnam’s total wood export value.
Available figures from the Vietnam Timber and Forest Products Association show local businesses are shipping more than US $14 billion worth of wood and wood products abroad, with US $1.49 billion going to China.
Meanwhile, wood imports were valued at more than US $2.5 billion, including US $1.1 billion from the northern neighbour. Typically, Vietnam is focused on exporting raw wood coded HS44 to China, with over 20 products making up about 80% of its total wood exports. Among them, wood chips represent a large proportion of the country’s total annual wood export turnover to this market.
China is Vietnam’s largest trading partner and a vital source of imports for its manufacturing sector. The two countries are already connected through a system of highways and two old railway lines that need upgrading on the Vietnamese side.
One of the planned high-speed lines would run from Vietnam’s port cities of Haiphong and Quang Ninh through Hanoi to Lao Cai province, which borders China’s Yunan province. The other would run from Hanoi to Lang Son province, which borders China’s Guangxi region, passing through an area densely populated with global manufacturing facilities, including some owned by Chinese investors.
Vietnam wants to “learn from China” about high-speed rail
Earlier this month, Vietnam said it sought to “learn from China” to develop its first high-speed railway network and had sent its officials to work with Chinese railway companies. Meanwhile, a massive high-speed railway line linking the capital of Hanoi with business hub Ho Chi Minh City is also being planned in the country.
Vietnam’s National Assembly chairman Vuong Dinh Hue has met with executives of Chinese railway companies during ongoing visits to Beijing where he was hosted by Premier Xi Jinping. This came after Vietnam and China signed dozens of cooperation agreements, including on railways, during a visit to Hanoi by Xi Jinping in December.
According to Vietnamese government data, trade between Vietnam and China rose 22% in the first quarter of this year to US $43.6 billion. The two countries remain embroiled in a long maritime dispute in the South China Sea, though tensions appear to have calmed recently.
In the meantime, the Dong Anh railway station in the Vietnamese capital of Hanoi remains busy ‘around the clock’ as container handling vehicles move back and forth, loading containers onto a timber express bound for Nanning, the capital of south China’s Guangxi Zhuang Autonomous Region.
A Chinese paper-making company purchased timber from southern Vietnam as raw material. Speaking of the China-Vietnam freight train service, Zhang Cunwei, head of VTO International Port Development, said that, like the timber express, a single train might have 10 or 20 containers carrying the same type of product.
“We often launch trains packed with timber that was reserved for transporting agricultural products, fruits, or other goods,” Zhang said. The China-Vietnam freight train service, which started in 2017, has expanded from transporting basic commodities to 300 or more goods.
Vietnam exports mainly agricultural products, fruits, electronics, textiles, and footwear, while China sends raw materials, such as steel, used in construction, for manufacturing in Vietnam. Vietnamese goods are delivered through the freight train service to more than 20 provinces and cities in China, as well as to central Asia and Europe by connecting with the China-Europe freight train service.
Meanwhile, Chinese goods are not only transported to Vietnam but also pass through Vietnam to reach Laos, Thailand, Cambodia, Malaysia, and other ASEAN countries.”
With the promotion and support by both countries’ railway authorities, more and more companies on both sides have ordered the freight train service for shortened transport time, simplified procedures and reduced costs.
At the Pingxiang Railway Port on the China-Vietnam border in Guangxi, freight trucks shuttle back and forth on the bridge, while China-Vietnam freight trains sound horns as they depart beneath it, reflecting a vibrant two-way trade between China and Vietnam.
With stable capacity, pricing, and timing, the market appeal of this service has increased. Now the service is covering China’s south-western market and the Guangdong-Hong Kong-Macao Greater Bay Area.
According to data from the Nanning Railway Administration, as of September 30, the China-Vietnam freight trains departing from Guangxi had shipped a record 10,380 containers this year.
In the future, the Vietnamese government and relevant departments plan to further invest in improving the railway infrastructure, including stations and freight yard systems to achieve seamless connectivity with China’s railways and enhance transport capacity between the two countries.
The rapid growth of the freight train service is attributed to the efforts by both countries to facilitate the process. In 2023, the Nanning Railway Administration completed railway upgrades from Nanning to Pingxiang, raising the freight train’s speed to 90 km an hour.
In January 2024, the entire China-Vietnam freight train service schedule was finalised, significantly reducing transport time. The total transit time from Nanning South Station to Hanoi’s Yen Vien Station has been cut from more than 40 hours to 14 hours.
In the future, the Vietnamese government and relevant departments plan to further invest in improving the railway infrastructure, including stations and freight yard systems, to achieve seamless connectivity with China’s railways and enhance transport capacity between the two countries.
