Railway industry needs reform

Hanoi (VNA) – The domestic railway industry should reform to increase its competitive ability and revenue in the second half of this year, an official of the Ministry of Transport has said.

At the conference on implementing the railway industry’s business missions by this year-end, held in Hanoi on July 6, the Vietnam Railway Corporation reported that its transport revenue reached 1.95 trillion VND (88.6 million USD) in the first half of this year, which was 77.5 percent of revenue in the same period last year.

The low revenue was partly due to the collapse of the Ghenh Railway Bridge in Dong Nai Province, affecting the transport of cargo and passengers in May and June which were hottest months of this summer tourism season. One more reason that impacted the volume of passengers was the massive fish deaths in four central coastal provinces.

Dao Anh Tuan, Director of Saigon Railway Transport Joint Stock Company, said the volume of passengers booking tickets on routes from Saigon to Da Nang, Hue, Dong Hoi and Vinh, reduced sharply this summer against last year, the Transport newspaper reported.

In addition, Phung Thi Ly Ha, Deputy General Director of Hanoi Railway Transport Joint Stock Company, said the railway industry has faced severe competition from low-cost airlines. The price of an air ticket of a low-cost airline stood at some 600,000 VND for a one-way ticket from Hanoi to Da Nang while the rail fare was 700,000 VND per bed, one-way for a 4-bed cabin, with air conditioning.

The railway firms could not reduce the fare further because they would suffer losses, Ha said.

The local railway industry still has numerous limitations and is not being utilised to its full potential, Tran Ngoc Thanh, Chairman of Vietnam Railway Corporation, said.

At present, an important thing was to re-organise transport activities for improving efficiency in transport and business, especially transport of cargo.

The market was competitive so the railways must take full advantage to exploit the segment that has a chance of development.

To promote transport and business as well as improve competitiveness in the second half of this year, the corporation must re-evaluate its restructure from corporate management to business activities and promote transport of cargo and passengers, Nguyen Ngoc Dong, Deputy Minister of Transport, said at the conference.-VNA