Vietnam Expands Trade Corridors

Vietnam's ambition to become a logistics powerhouse is backed by massive infrastructure investments, including the US$67.3 billion North-South high-speed railway. This 1,541-kilometer line is designed to be the backbone of the country's transport network, linking its northern, central, and southern regions to enhance trade and lower logistics costs. A key project in the north is the US$8.36 billion Lao Cai - Hanoi - Hai Phong railway, a strategic freight corridor designed to connect the Hai Phong seaport system directly with China's Yunnan province and onward to European markets. This route is a critical component of the Kunming - Lao Cai - Hanoi - Hai Phong economic corridor, aiming to boost trade competitiveness. In the south, the new Can Gio International Transshipment Port near Ho Chi Minh City is poised to become a major hub. The US$6 billion project, a partnership with the world's largest shipping line MSC, will be capable of handling the largest container vessels and is expected to start its first phase in 2027. These infrastructure upgrades are a direct response to the "China Plus One" strategy, where global companies are diversifying their supply chains to mitigate geopolitical risks. Vietnam's political stability, competitive labor market, and numerous free trade agreements, including the CPTPP and EVFTA, make it an attractive alternative for high-tech manufacturing, not just textiles and footwear. The government's master plan for transport infrastructure aims to build thousands of kilometers of new expressways and high-speed rail by 2030, with a projected cost of up to US$65 billion. By the end of 2025, the country had already surpassed its expressway construction targets, completing nearly 2,000 km in the preceding five years alone. This focus on logistics is transforming cities like Da Nang into major hubs. With two international ports, two airports, and a rail system connecting to Laos, Thailand, and Myanmar, Da Nang is developing a deep-sea port and a 19,000-hectare free trade zone to solidify its role as a key transit point. Beyond Asia, Vietnam is pioneering new trade routes, such as an emerging Indo-African maritime corridor centered on the Port of Berbera in Somaliland. This strategic move aims to diversify export markets, manage risks in the Red Sea, and create direct, efficient trade links with East Africa's growing consumer and industrial markets. The influx of foreign direct investment is heavily reliant on this infrastructure push, with foreign-invested enterprises accounting for approximately 71.9% of Vietnam's total exports in 2024. Major tech companies like Samsung, Apple, and Intel have already shifted significant parts of their manufacturing and supply chains to the country.