Decision No. 1686/QD-TTg dated November 20, 2008 of the Prime Minister approving the strategy for development of Vietnamese railway transport up to 2020 with a vision toward 2050

DECISION

APPROVING THE STRATEGY FOR DEVELOPMENT OF VIETNAMESE RAILWAY TRANSPORT UP TO 2020 WITH A VISION TOWARD 2050

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government:

Pursuant to the Political Bureaus Conclusion No. 27-KL/TW of September 17, 2008 on the Strategy for development of Vietnamese railway transport up to 2020 with a vision towards 2050;

At the proposal of the Ministry of Transport in its Report No. 7731/TTr-BGTVT of October 22, 2008,

DECIDES:

Article 1. To approve the Strategy for development of Vietnamese railway transport up to 2020 with a vision towards 2050, with the following principal contents:

1. Development viewpoints

a/ The railway development strategy must be in line with the overall strategy for transport development and the strategy for national socio-economic development up to 2020 with a vision towards 2050;

b/ Railway transport constitutes an important part in socio-economic infrastructure, which requires investment priority for development one step ahead;

c/ Railway transport will be developed towards modernity, fastness and sustainability and in close association with other modes of transport, making full use of advantages and most effectively serving the national development;

d/ Railway development must be associated with security and defense maintenance, environmental protection, social order and safety assurance and contribute to minimizing traffic congestion and accidents and to the development of remote, deep-lying and difficulty-hit regions;

dd/ The State concentrates investment on the development of national railway infrastructure, building or upgrading a number of important railroads such as the North-South express railroad, Lao Cai- Hanoi- Hai Phong railroad and Hanoi-Dong Dang railroad under the program on Vietnam-China two corridors - one economic belt, and at the same time attaches importance to the maintenance of existing infrastructure, ensuring fruitful exploitation and smooth, orderly and safe traffic;

e/ To quickly develop railway transport in urban centers, inner-city and suburban areas, serving as the core for mass transit, first of all in Hanoi and Ho Chi MinhCity;

g/ To encourage various economic sectors to invest and mobilize to the utmost all resources for investment in the development of railway infrastructure, means of transport and transport business under planning and uniform state management, in which state enterprises will manage the exploitation of infrastructure systems and do transport business on principal and important national railroads;

h/ To boost the development of specialized railway science, technology and human resources and intensify international cooperation for quick railway industrialization and modernization;

i/ To build the railway industry strong enough to manufacture locomotives, carriages, parts, components and other equipment in better service of domestic demands and export in the future;

k/ To reserve rational land funds for railway transport infrastructure development, ensuring safe railway traffic corridors in strict accordance with the Railways Law.

2. Development strategy

a/ General objectives

The State concentrates investment on the development of national infrastructure while encouraging investment from various economic sectors, organizations and individuals. To develop modern and effective railway business management models.

- By 2020: Vietnamese railway will be built into a modem one, developing with sustainability, safety and environmental protection. To complete and exploit a number of sections on the North-South express railroad and nearly-express railroads on Lao Cai-Hanoi-Hai Phong and Hanoi-Dong Dang corridors. The existing railway systems will be upgraded or restored up to prescribed technical standards, being able to connect to railroads of regional countries, industrial parks, seaports and big mines. In big cities, a number of urban railroads will be built to reduce traffic jams and accidents. Products manufactured by the railway industry will have high local content. Transport services will be expanded with high quality.

- Vision towards 2050: Vietnamese railway will fully meet the criteria on railways of an industrialized country, with modern national railway and urban railway networks connecting political, cultural and tourist centers, key economic regions, big industrial parks, large sea ports in service of socio-economic development, security and defense requirements and the promotion of cultural exchanges and tourism inside and outside the country with high quality and better services.

b/ Specific objectives

To ensure balanced development suitable to each period; to identify a rational priority order so as to concentrate resources on development investment, in which priority should be given to the construction of urban railway systems in such big cities as Hanoi and Ho Chi Minh City, the Hanoi-Lao Cai railroad and the North-South express railroad.

- Up to 2020

+ To satisfy at least 13% of the passenger transportation demand and 14% of the cargo transportation demand, of which 37% for passenger transportation on such main corridors as North-South corridor, 40% for passenger transportation and over 45% for cargo transportation on the East-West corridor; to satisfy 20% of the urban passenger transportation demand.

+ To prioritize the implementation of urban railway projects in Hanoi and Ho Chi Minh City for early operation; to strive for the completion and operation of Lao Cai - Hanoi - Hai Phong and Hanoi - Dong Dang railroads (under the program on Vietnam - China two corridors-one economic belt); to invest in the complete construction and operation of the North-South express railroad at the speed of 350km/h, giving priority to the early completion of Hanoi - Hue or Hanoi - Da Nang section and Ho Chi Minh City -NhaTrang section: to complete and commission Yen Vien- Pha Lai - Ha Long - Cai Lan railroad and railroads linking to big seaports, industrial parks and tourist resorts.... To upgrade existing national railroads to the 120 km/hour standards in service of inter-provincial transportation, cargo transportation and connection with ASEAN countries railroads; to study the development of railway networks in the west of the country.

+ Vietnamese railway networks must reach the density of 15 17km/1,000 km2 and around 50-70 km/one million people: the dual gauge railroads will represent 35 39% and the electrified railroads, 40 44%, of which, mainly the North-South express railroad; the nearly express railroad on the East-West corridor and the urban railroads in Hanoi and Ho Chi Minh City.

+ To renovate and build establishments to manufacture and assemble locomotives and carriage-sand make spare parts with a localization rate of 50-60%; to renew technology and expand the production scale for building about 5,000-9,000 passenger cars and 50,000-53,000 cargo wagons of high quality, meeting domestic and export demands.

- Vision towards 2050

+ To satisfy at least 20% of the passenger and cargo transportation demands, of which 40% for passenger transportation on the North-South corridor and 45% for passenger transportation and over 50% for cargo transportation on the East-West corridor; to satisfy at least 25% of urban passenger transportation.

+ To complete the North-South express railroad with sections linking Hanoi with Lang Son and Ho Chi Minh City with Can Tho and Ca Mau; to complete the construction of the Central Highland railroad, trans-Asia railroad and northern delta coastal railroad; in addition to be completion of urban railroad networks in Ha Noi and Ho Chi Minh City with such suitable technological solutions as metro or sky-train in order to basically solve traffic congestion, investment must be concentrated on the development of urban railway networks (metro and sky-trains) in other big cities.

+ Vietnamese railway networks must reach the density of 18 21 km/1,000 km2 and around 60-80 km/one million persons, dual-gauge railroads will represent over 50% and electrified railroads, over 50%.

+ To develop and modernize specialized railway industrial establishments, striving to meet 100% of the domestic demand and in export the future.

c/ Policies and implementation solutions

- Regarding organization and institution

+To further finalize the master plan on railway transport development in conformity with the orientations of the master plan on communications and transport and the national planning on socio-economic development in the coming period.

+ To study the supplementation, elaboration and amendment of local documents, criteria, standards, processes, norms and unit-price setting in order to complete the legal system related to railway transport development.

+ To set rational freight rates suitable to the market mechanism and socio-economic conditions of each region. To use tax and macro-financial policies to regulate railway transport activities.

+ To develop Vietnam Railway Corporation into multi-branch and multi-owner Vietnam Railway Group operating after the parent-affiliate company model, in which the parent company is a state-owned company tasked to manage and maintain the railway infrastructure system and organize the administration of the railway transport system, and affiliate companies are independent accounting enterprises which are closely bound to the parent company in capital, technology and brand of operation in railway transport and other relevant domains prescribed by law.

+ To intensify the association and coordination between ministries, branches or localities and the Vietnam Railway Corporation. To heighten the responsibility of administrations at different levels in leading and directing the implementation of the planning, the preservation of land funds for railway development and the maintenance of railway traffic safety and order.

- Regarding capital mobilization

+ To proactively arrange state budget capital while adopting special mechanisms to mobilize capital from various economic sectors at home and abroad such as ODA capital, preferential loans of foreign governments and government bonds for investment in the construction of urban railway systems and key railroads such as the North-South railroad (especially the express railroad) and railroads under the Vietnam-China two corridor-one economic belt program.

+ To develop and promulgate mechanisms to encourage all economic sectors to invest and deal in railway transport business, attracting at least 10% (by 2020) and 20% (by 2050) of total investment capital from various economic sectors, organizations and individuals for investment in the construction of railway infrastructure in such forms as exchange of land for infrastructure, joint venture, BOT and issuance of project bonds for railroads and sections with exploitation advantages under planning and the state management.

+ To adopt mechanisms to support railway industrial establishments in importing modern new technologies from advanced countries.

- Reparding human resource development

+ To increase investment in material and technical foundations, renew programs and expand forms of training; to attach importance to the mobilization of all social resources for training, ensuring adequate supply of high-quality human resources in better service of the development of modem railways.

+ To adopt policies on wages and preferential treatment for laborers working under peculiar conditions of the railway sector, especially in remote, deep-lying and difficulty-hit regions.

+ To establish a research institute to conduct specialized railway training and research; to upgrade the existing railway vocational training school to be capable of training engineers, meeting present and future railway development requirements.

+ To allocate quotas of overseas graduate and post-graduate training in railway.

- Regarding science and technology

+ To adopt policies to encourage scientific and technological research and application, encourage the training and attraction of outstanding professionals to work in the railway transport domain.

+ To apply new sciences and modern technologies to research, training, transport exploitation, infrastructure construction, industries and services. To attach special importance to applying information technology to the elaboration of plans on exploiting, collecting and processing information on customers; to develop automatic ticket sale and control systems; to invest in high-end equipment and facilities and provide aboard services of international standards.

- Regarding international cooperation

To expand international cooperation particularly with countries having a developed railway sector, accepting advanced experiences in railway development, cooperating on the training of human resources to take over transferred modern and advanced technologies in order to meet the immediate domestic development demands, then expand the market to other countries in the region and the world in the future.

Article 2. Tasks of concerned ministries, branches and units

1. The Ministry of Transport:

a/ To manage and direct the implementation of the Strategy, and study to be-updated contents, if any, and submit them to the Prime Minister for consideration and decision;

b/ To direct the formulation of overall and detailed plans to materialize the Strategy;

c/ To regularly evaluate and update transport demands for rational development of investment projects to fully satisfy economic development requirements. In case of big changes, calculation, proposal and timely adjustment should be made.

2. The Ministry of Planning and Investment, the Ministry of Finance and the State Bank of Vietnam:

To coordinate in further studying, completing and promulgating mechanisms to mobilize and efficiently use investment capital for railway development.

3. The Ministry of Natural Resources and Environment:

To assume the prime responsibility for, and coordinate with the Ministry of Transport in, formulating legal provisions on land reserved for railways, land within the railway traffic safety corridors and protection of railway land.

4. The Ministry of Industry and Trade:

To study policies to ensure stable electricity supply for electrified railways and information and signal systems.

5. The Ministry of Education and Training:

To assume the prime responsibility for, and coordinate with the Ministry of Transport in, creating favorable conditions and reserving quotas for railway trainings at home and abroad.

6. Peoples Committees of provinces or centrally run cities where railroads run through:

To maintain traffic security, order and safety and conduct propaganda to raise peoples sense of protecting railway works.

7. The Vietnam Railway Corporation:

To take the initiative in studying and proposing mechanisms and policies related to exploitation, additional charge and training programs and coordinate with concerned ministries, branches and agencies in the implementation of this Strategy.

Article 3. This Decision takes effect on the date of signing.

Ministers, heads of ministerial-level agencies, heads of government-attached agencies, presidents of provincial/municipal Peoples Committees and concerned units and individuals shall implement this Decision.