HANOI — The European Union (EU) is initiating a 40-million-euro sustainable transport development fund with an aim to mobilize an additional one billion euros from banks and the private sector to finance major infrastructure projects in Vietnam.
This was unveiled by Jozef Síkela, European Commissioner for International Partnerships, at the first EU-Vietnam Global Gateway business and investment forum in Hanoi today, March 24.
The fund is designed to provide expertise and technology to accelerate at least four large-scale projects, including the North-South high-speed railway, inland waterway developments and urban transport networks.
Beyond the initial fund, Síkela detailed a plan to leverage one billion euros in preferential loans from European banks and private businesses. This commitment is part of a broader EU pledge of over 500 million euros toward sustainable transport and clean energy in Vietnam. Notably, the European Investment Bank (EIB) has extended a 200-million-euro credit line to Techcombank to support small and medium-sized enterprises (SMEs) investing in renewable energy, energy efficiency and electric vehicles.
Another portion of this investment, around 230 million euros, will be allocated to the Bac Ai pumped storage hydropower plant in Khanh Hoa Province. As Vietnam’s first project of its kind, the 1,200 MW plant is invested by Vietnam Electricity Group (EVN). To be completed in 2030, the project is designed to store excess energy from renewable and nuclear sources during off-peak hours by pumping water to an upper reservoir. The project represents a total investment of over VND21 trillion, supported by a loan from the French Development Agency (AFD) worth 76 million euros (VND2,000 billion).
In addition to energy and rail, the EU-Vietnam partnership continues to expand into maritime and urban logistics. Following the expansion of Hanoi’s Metro Line 3, European firms are set to support the development of the Lien Chieu container port in Danang City.
Speaking at the forum, Vietnamese Deputy Prime Minister Ho Duc Phoc said that the bilateral relationship has flourished for over 30 years, bolstered by the EU-Vietnam Free Trade Agreement (EVFTA). He called on EU member states to expedite the ratification of the EU-Vietnam Investment Protection Agreement (EVIPA) to further solidify the legal framework and bolster investor confidence in high-tech sectors such as semiconductors, green economy and strategic infrastructure.
