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Thiên Lương wrote this Vietnamese article, publishe d in Luật Khoa Magazine on June 18, 2025.

A proposal from VinSpeed and THACO, two major companies participating in the North–South high-speed railway project, raises serious concerns about financial risk. The companies have asked the state to support a loan of 49.1 billion USD, which would cover 80% of the project's total investment capital.

This unprecedented request leaves two critical questions unanswered. First, where would the state mobilize such a massive sum? More importantly, if the project fails to progress as planned, who will ultimately bear the financial burden: the state, the corporations, or Vietnamese taxpayers?

A Project with Record Investment Capital The North–South high-speed railway has been a topic of national discussion in Việt Nam for nearly two decades. The project was first proposed in 2006 under Prime Minister Nguyễn Tấn Dũng with an estimated cost of 32 billion USD (approximately 831.5 trillion đồng). By 2010, that price tag had risen to 56 billion USD, leading the National Assembly to reject the proposal due to concerns over its cost and effectiveness.

The project was not revived until late 2024, when the 15th National Assembly finally approved the investment policy during its 8th session. The green light came with a 92.48% approval rate (443 out of 454 delegates voting in favor) and a new, total expected cost of 67.34 billion USD (approximately 1.713 quadrillion đồng). This makes it the most significant public investment project in Việt Nam's history, to complete the 1,541 km route by 2035.

While the project is approved, the legal framework is still being finalized. At the ongoing 9th session, the National Assembly is debating amendments to the Railway Law, which include special mechanisms for participating enterprises. This is happening alongside a significant push to promote the private sector—signaled by the recent issuance of Politburo Resolution 68 and National Assembly Resolution 198—opening the door for domestic companies to participate in other key national projects.

VinSpeed and THACO Propose State-Supported Loans for 80% of Project Capital VinSpeed, a subsidiary of Vingroup chaired by Phạm Nhật Vượng, was the first to submit a proposal for the project. Established on May 6 with a charter capital of just 6 trillion đồng, the company proposed a total project investment of 61.35 billion USD.

Its funding model involves raising 20% of the capital and seeking a zero-interest, 35-year loan from the state for the remaining 80% (49.1 billion USD). In return, VinSpeed promises a five-year completion timeline and seeks a 99-year right to collect tolls and develop land along the route, with the state covering all land clearance costs.

THACO Group, chaired by Trần Bá Dương, submitted a competing proposal. While THACO did not request a direct state loan, it seeks government guarantees and interest rate support for 30 years. The company projects a seven-year completion timeline and requests a 70-year toll collection period, 29 years shorter than VinSpeed's proposal.

While the specific terms differ, both proposals could save the state budget around 6 billion USD and significantly shorten the project's construction timeline. In exchange, the companies expect to negotiate access to state loans, land rights, and other commercial opportunities linked to the project.

However, a major point of contention is that neither VinSpeed nor THACO has prior experience in developing high-speed rail infrastructure. Despite this, it should not be a disqualifying factor. According to Associate Professor Dr. Trần Đình Thiên, a member of the Prime Minister’s Policy Advisory Council, the state must break from the outdated mindset of only using local firms as subcontractors for foreign developers. "No one is born knowing how to build high-speed railways," Thiên stated. "If we don’t give Vietnamese companies the opportunity, how will they ever gain the experience?"

Who Benefits in the End? While VinSpeed and THACO claim their proposals will ease the state’s financial burden, the sheer scale of the requested financing raises serious questions about public debt. The 49.1 billion USD state-backed loan requested by VinSpeed is 2.5 times larger than the government’s entire 2025 bond issuance plan. This comes when Việt Nam's public debt already stood at 177.5 billion USD as of late 2024. Shouldering this additional debt would increase the burden on each of Việt Nam's 101 million citizens, who already carry a per-capita debt of around 1,750 USD—a significant figure compared to the average monthly income of 5.4 million đồng.

Concerns are rooted in the history of large-scale public projects in Việt Nam. Past examples, such as the Phú Thọ Ethanol Plant which was riddled with corruption involving high-ranking officials like Đinh La Thăng and Trịnh Xuân Thanh, have led to public skepticism about "lubrication fees" and potential mismanagement being built into the project's massive budget.

There are also concerns about public participation and land rights. Historically, citizens have often been excluded from the decision-making process for major national projects. This lack of consultation has fueled a decades-old problem where land is acquired from citizens at extremely low compensation rates, only to be resold by developers at exorbitant prices. The issue is highly relevant today; on June 16, Deputy Prime Minister Trần Hồng Hà announced that the government has ordered the expedited clearance of 10,800 hectares for the project, affecting 120,000 households across 15 localities.

Despite these risks, some experts view the project as a national technology platform that could deliver immense socio-economic benefits, such as job creation, modernized infrastructure, and significant trade growth.

A New Domestic Firm Joins, Promising 100 Billion USD in Investment Just as the debate between VinSpeed and THACO intensified, a third company, Mekolor, submitted a shocking proposal: to fund the project with 100 billion USD in pure equity, requiring no state matching funds or financial guarantees.

Mekolor, owned by Võ Xuân Trường, promised to partner with a U.S. firm named Great USA to raise the capital. The company pledged to finish the project in just five years, operate it for 49 years with 95% Vietnamese staff, and even offer free fares to all passengers for the first six months of operation.

The announcement was met with immediate and widespread skepticism. Public records show Mekolor has only four employees and a registered capital of just 1 billion đồng. Media outlets like VietNamNet questioned the origin of the 100 billion USD pledge, while Dân Trí noted the company’s office is hidden deep within an alley. This skeptical reaction stands in stark contrast to the supportive state media campaign that greeted the proposal from billionaire Phạm Nhật Vượng’s VinSpeed.

Responding to the doubts, Võ Xuân Trường made a fantastical claim, stating he had secured EUR 78.5 trillion (approximately 84.8 trillion USD) from his and Great USA's funds—a sum larger than the entire planet's annual GDP. He further claimed that the investment of 100 billion USD could be recovered within 15 years. For context, Mekolor JSC was founded in 2016 in Cần Thơ, primarily in trade promotion, while its Florida-based partner, Great USA, reportedly specializes in cryptocurrency and investment fund connections.

Counting the Cost: Who Will Finance Việt Nam’s Ambitious $49.1 Billion Rail Project?

Thiên Lương

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Counting the Cost: Who Will Finance Việt Nam’s Ambitious $49.1 Billion Rail Project?

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