The Ministry of Transport agrees with the opinion of the State Capital Management Committee that the Vietnam Expressway Corporation (VEC) has the capacity to act as the investor and manage the operation of the Hochiminh City – Long Thanh Expressway.
The Ministry of Transport believes that compared to public investment and investment through the PPP model, assigning the project to VEC has several advantages.
 The Ministry concurs with the State Capital Management Committee that VEC possesses the requisite capabilities to serve as the investor and operator of the Hochiminh City – Long Thanh Expressway. |
Firstly, it maximizes the role and resources of state-owned enterprises, aligning with the objective of VEC’s formation. This unified approach to the expressway’s operation and management sets the stage for VEC to invest in expanding the expressways under its management.
Secondly, it considers VEC’s ownership status of the road assets during the specified period, as the process of transferring these assets to VEC through increased charter capital is underway.
Thirdly, it eliminates the need for public investment, alleviating pressure on the state budget.
Fourthly, the implementation timeline is shorter.
Fifthly, assigning the project to VEC avoids potential conflicts of interest between VEC and a new entity, which could arise if the PPP model were employed.
The report states, “Using the capital of state-owned enterprises like VEC to invest in infrastructure is one of the three current investment forms for transport infrastructure, similar to how the Vietnam Air Traffic Management Corporation and the Vietnam Airports Corporation invest in airport infrastructure.”
According to the proposed plan, the expansion project for the Hochiminh City – Long Thanh Expressway will be nearly 22 kilometers long.
Specifically, the section from the Hochiminh City Ring Road 2 Junction (Km 4+000) to the Hochiminh City Ring Road 3 Junction (Km 8+770) will be widened to eight lanes as per the master plan.
The stretch from the Hochiminh City Ring Road 3 Junction (Km 8+770) to the Bien Hoa – Vung Tau Highway Junction (Km 25+920) will be expanded to ten lanes, in line with the master plan.
The preliminary total investment for the project is estimated at VND 14,955 billion (including interest during construction, excluding site clearance costs). Of this, VND 5,555 billion (37%) will come from equity, and VND 9,400 billion (63%) from commercial loans.
VEC will mobilize 100% of the capital required for the project’s investment and organize the operation and toll collection for repayment. Central and local budgets (Ho Chi Minh City and Dong Nai) will be used for site clearance and will be separated into an independent project under the public investment form.
If approved by the competent authority, the project will undergo the investment preparation phase from 2024 to 2025 and the implementation phase from 2025 to 2027.
N. Huyen
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