Vietnam Transportation And Telecommunications

Transportation Overview: Vietnam’s transportation system is in need of modernization and expansion. Ports are operating at only one-third of capacity. Roads are in generally poor condition, and the underdeveloped railroad system carries less freight than the inland waterways. Motorcycles are more popular than buses. In an effort to improve bus service, Hanoi plans to invite private companies to bid for operating rights for six municipal bus routes.

Roads: Vietnam’s roads extend over 210,000 kilometers, implying a network density twice as high as Thailand’s and Malaysia’s. However, the condition of the roads is generally poor; only 13.5 percent of the roads are considered to be in good condition. Only 29 percent of the roads are tarred, and road access is cut off to more than 10 percent of villages for at least one month per year because of monsoons. In 2005 the construction of the 1,690-kilometer Ho Chi Minh Highway, which eventually will link Hanoi and Ho Chi Minh City, was still underway. The project, which is expected to cost US$500 million, is the largest transportation project since the end of the Second Indochina War. Despite government efforts to promote the use of buses, motorcycles remain the preferred mode of local transport. There is one motorcycle for every seven people. Poorer citizens rely on bicycles, while only the affluent can afford cars.

Railroads: Vietnam has six single-track railroad routes with a total length of 3,260 kilometers. The network’s density is only about one-third the average for low-income countries. The longest railroad line measures 1,730 kilometers from Hanoi to Ho Chi Minh City and requires 32 hours to traverse on the Reunification Express. Of the nation’s inventory of rolling stock, 25 percent is not operational. Twenty-five percent of the nation’s operational rolling stock is more than 30 years old. Freight traffic picked up in 2000 and 2001 following five years of decline. Vietnam needs more than US$400 million between 2004 and 2009 to modernize its railroads. The government plans to build two subway lines in Ho Chi Minh City by 2007. Project-related costs are estimated at US$800 million.

Ports: The principal ports in Vietnam, listed from north to south, are Haiphong, Quang Ninh, Danang, Qui Nhon, Ho Chi Minh City, and Can Tho. Altogether, Vietnam has seven international ports and five additional ports that specialize in transporting oil and coal. The freight volume is about 14 million tons annually, compared with only 4.5 million tons in 1993. However, total traffic is only about one-third of capacity. Vietnamese ships carry only about 20 percent of the country’s international trade, although plans exist to expand the merchant fleet substantially.

Inland Waterways: Vietnam’s inland waterways, primarily the Mekong River and Red River systems, carry more freight than the railroads, and the volume of freight is rising slowly. According to the World Bank, transportation productivity via the inland waterways is 40 percent below the system’s potential, assuming proper maintenance, navigation aids, and dredging.

Civil Aviation and Airports: Vietnam operates 17 major civil airports, including three international gateways: Noi Bai serving Hanoi, Danang serving Danang City, and Tan Son Nhat serving Ho Chi Minh City. Tan Son Nhat is the largest, handling 75 percent of international passenger traffic. Vietnam Airlines, the national airline, has a fleet of 30 aircraft that link Vietnam with 19 foreign cities. In 2004 Vietnam Airlines had 5 million passengers, up 25 percent from the prior year, and management expects the number of passengers to reach 12 million by 2010. In November 2004, Vietnam Airlines announced that it would purchase 10 Airbus A310–200 aircraft and continue negotiations for four Boeing 7E7 “Dreamliner” aircraft. Vietnam Airlines’ goal is to expand its fleet to 73 aircraft by 2010. Beginning in 2006, Vietnam Airlines will cooperate with American Airlines in international flights under a codeshare agreement. Vietnam Airlines’ code will apply to American Airlines flights from the United States to Vietnam, Japan, and Europe. American Airlines’ code will apply to Vietnam Airlines flights from Vietnam to Japan and Europe.

Pipelines: In April 1995, a 125-kilometer natural gas pipeline connecting Bach Ho with a power plant near Vung Tau went into operation. With the subsequent addition of compressors, the volume pumped rose to more than 1 billion cubic meters per year. In 2005 a 399-kilometer underwater pipeline, the world’s longest, began to carry natural gas onshore from the Nam Con Son basin. The pipeline’s anticipated capacity is 2 billion cubic meters per year, while the basin has an estimated 59 billion cubic meters of natural gas reserves.

Telecommunications: The International Telecommunication Union rates Vietnam’s telecommunications market the second fastest growing in the world after China. With rapid telecommunications growth leading to 4.9 million landline telephones and 3.4 million mobile telephones as of mid-2004, Vietnam’s telephone penetration rate is still only 10 percent. As of mid-2004, Vietnam had 5.1 million Internet users, corresponding to 6 percent penetration. In 2000 Vietnam had about 600,000 personal computers, or 7.35 for 1,000 people. In 2003 Vietnam had 8.2 million radios, or 100.45 per 1,000 people. There were 65 AM radio stations, 7 FM stations, and 29 shortwave stations. Also in 2003, Vietnam had 3.6 million televisions, or 43.73 per 1,000 people. Television broadcast stations numbered at least seven in 1998.