A high-speed railway is being planned for the first time to link landlocked Laos with Vietnam, and which will be fully operational within five years from now.
A ceremony for signing of the construction contract was held in Vientiane, capital city of Laos, on Monday in the presence of Lao Prime Minister Thongsing Thammavong and Malaysian Prime Minister Najib Tun Abdu Razak.
The US$5 billion project will be funded by Malaysia's Giant Consolidated Limited Group.
The high-speed railway track will stretch across 220km, from the central province of Savannakhet in Lao all the way to the Lao Bao border gate of the central province of Quang Tri in Vietnam.
The railway will be part of the Southeast Asian Railway Network, which will link landlocked Laos to its neighboring countries and Yunnan Province in southern China.
In other news, Vietnam will receive a Euro 150 million loan from the European Investment Bank (EIB) as part-finance for a climate change project.
The loan agreement was signed in Hanoi by Ms Magdalena Álvarez Arza, Vice President of EIB, and Mr. Truong Chi Trung, Vice Minister of Finance.
The climate change project will ensure environmental sustainability and will make long-term financing available for investments that contribute to climate change mitigation through reduction of greenhouse gas emissions, use of renewable energy sources and energy efficiency enhancements, all priorities of EIB.
Ms Álvarez believes that the loan will help promote sustainable and high-quality economic growth in Vietnam.
This is the second loan of its kind in Vietnam. The first was Euro 100 million via a Vietnam Climate Change Framework Loan signed in May 2009 between Vietnam and EU, provided under the Climate Change Mandate 2011-2013 and the EIB’s eighth operation in Vietnam, since 1996.
Since then, the Bank’s financing in Vietnam has reached almost Euro 50 million, including this present loan.