Construction of new expressway awaits incentives

In order to speed up the construction progress of the project, the Ministry of Transport early last month established a management board in charge of PPP projects.

Speaking to the Daily, Le Anh Tuan, head of the management board, said the project was temporarily approved in terms of basic design, total investment capital and assessments on environmental impacts.

With a total length of 98.7 kilometers, the grade-A traffic work will have six lanes and permits a designed velocity of 120 kilometers an hour and will cost over US$846 million in investment capital for the first phase.

The World Bank as the key lender for the project has agreed with the Government on developing the expressway as a pilot PPP project.

In 2008, the Prime Minister had asked Bitexco Group as the first investor of the project to draw up the investment plan and in 2010 the transport ministry sent the draft plant to the Prime Minister for final approval.

The new expressway when in place will shorten the travel time from HCMC to the south-central region and will ease the current severe traffic congestion on the National Highway 1A. Besides, its completion will also expectedly facilitate the establishment and development of industrial parks and tourism facilities along the route.

The biggest difficulty of the scheme now is to set up an appropriate mechanism with strong incentives so as to attract the second investor who will join forces with Bitexco to start the project as soon as possible.

When asked about the schedule to kick off the project, Tuan said this depends on the result of the negotiation with the World Bank and private investors regarding disbursement of capital and preferential policies for the project. This means the construction schedule still remains unknown, Tuan said.

At the meeting to handle troubles for the project last week, Deputy Prime Minister Hoang Trung Hai asked the Ministry of Transport and the Ministry of Planning and Investment to work with partners on the project’s efficiency as well as solutions to mobilize funds. Hai also asked the transport ministry to promptly complete the mechanism and to submit it to the Prime Minister so that the project can get going soon.