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Urban Transport

Rapid growth of urbanization and large demand for transport in major urban areas in Vietnam require an improved urban transportation network.

There is a road map in place with the purpose of improving urban transportation in Vietnam which plans to expand the present road and public transportation network capacity to meet future demand. Scarce funding and poor management have led to delays in certain previous urban transport projects.

Opportunities

In Vietnam, the existing public transport system consists of a poor and badly integrated network. Public transport mainly operates in major cities such as Hanoi, Da Nang and Ho Chi Minh City. Virtually all city buses are currently non-BRT, as no BRT-project has yet become operational. Currently, Vietnam has two BRT systems under planning; Da Nang and Ho Chi Minh City, with the total investment of USD 50 million and USD 137 million respectively, funded largely by the World Bank.

The government has also outlined a few key objectives to improve the railway sector. Outstanding projects include two MRT systems in Hanoi and Ho Chi Minh City, which are under construction with the total investment of USD 1.4 billion and USD 5 billion respectively. Financial support comes from multilateral and bilateral financiers such as the World Bank, Asian Development Bank, European Investment Bank, etc. 

The government prioritizes to develop sustainable urban transport systems. Since there are several responsible agencies existing depending on the sector, it is important for foreign investors to know which agencies that are responsible for their projects of interest.

Swedish companies such as Axis Communications, Gunnebo, Icomera and Kapsch Trafficom are active on the market, but there are large untapped opportunities. Swedish companies may consider to invest in PPP projects to capture the full opportunity in Vietnam.