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The airline said flight MH370 disappeared at 2:40 am local time (1840 GMT Friday), about two hours after leaving Kuala Lumpur International Airport. It had been due to arrive in Beijing at 6:30 am local time (2230 GMT Friday).
A statement posted on the official Vietnamese government website said the flight disappeared in Vietnamese airspace.
`The plane lost contact in Ca Mau province airspace before it had entered contact with Ho Chi Minh City air traffic control,` it said.
The plane was meant to transfer to Ho Chi Minh City air traffic control at 1722 GMT but never appeared, the statement said, citing a senior Ministry of Defence official.
Vietnam`s Ministry of Defence has launched rescue efforts to find the plane, working in coordination with Malaysian and Chinese officials, the statement added.
The Boeing 777-200 was carrying 227 passengers, including two infants, from 13 different nationalities, and 12 crew members.