China and Vietnam may finally take a decision about the extension of the normal gauge railway track from the Chinese border to Hanoi. Vietnam has a different gauge, and this is holding back the full potential of cross-border rail freight. The gauge extension has been on the table for years, but the neighboring countries have agreed to “accelerate the completion of the evaluation”.

This was one of the conclusions at the official visit of Party General Secretary Nguyen Phu Trong to China from October 31 to November 1. During this visit, the respective governments discussed how to facilitate cooperation in aviation, land and railway transport.

Better border infrastructure

One of the commitments made was to negotiate amending the 1992 Vietnam-China Border Railway Agreement. They discussed reopening border crossings, constructing cross-border infrastructure and connecting the railway between Lào Cai (Vietnam) and Hekou (China).

But another, more ambitious project is the change of gauge on the Vietnamese side. The railway line that runs from Hanoi to Lào Cai currently has a metre gauge. Cargo that crosses the border to China needs to be reloaded. Moreover, the volumes that can be moved by rail through Vietnam are relatively low.

Vietnam-China boost

At the same time, the demand for rail freight between China and Vietnam is on the rise. According to the Global Times, the volumes rose by 58.6 per cent year-on-year in the first 10 months of this year. A total of 607,000 tons of goods travelled across the border, the publication writes based on data released by customs authority in Nanning, South China’s Guangxi Zhuang Autonomous Region.

This is partly thanks to the New International Land-Sea Trade Corridor. This trade and logistics passage jointly built by Singapore and provincial-level regions of western China allows for multimodal links from many regions in China to many regions in southeast Asia. Chongqing is at the heart of the corridor. Cargo from Chinese provinces is bundled for transport further south, or further into China. In March 2022, the first train departed from this Chinese city to Vietnam and not much later, the Xi’an-Hanoi service commenced via the same route.

The link via Chongqing is however not the only way China connects to Vietnam. In fact, a lot of rail freight traffic runs between the countries as part of the longer journey to or from Europe. This cargo is collected in for example Zhengzhou or Suzhou before it continues on the New Silk Road. A good example is the service Hanoi-Zhengzhou-Liege.