Construction of the 1,690-kilometre highway started in March, with completion scheduled for mid-2003.
The route near the Laotian and Cambodian borders often passes through heavy jungle and over mountains. It will ease congestion on Highway 1 along the South China Sea coast and offer an alternative route.
Although turning the old trail into a road has been mooted for many years, it was only taken seriously after floods devastated coastal sections of Highway 1 late last year.
In 1959 the North Vietnamese started building the Ho Chi Minh Trail, which was not one single road but a series of paths through the jungles, to transport weapons and goods to fight the US-backed South.