Saturday, 18 Nov 2017

Huge private capital needed for transport projects

Updated at Sunday, 14 Dec 2014, 14:59
The Hanoitimes - The transport sector will have to mobilize at least VND235 trillion (some US$11 billion) from different sources exclusive of the State budget for infrastructure development in 2016-2020.

The huge non-state capital amount was announced at a seminar on the solutions to attract investments in transport infrastructure projects in Hanoi.

Nguyen Viet Huy, deputy head of the Department of Public-Private Partnership (PPP) Projects, told the seminar that official development assistance and the State budget have been the main capital sources of transport projects in the country in recent years as it is difficult to attract investments from other sources. Some VND20 trillion is allocated to transport projects a year, which is less than 50% of the demand.

Transport projects, private capital, seaport projects

To fuel infrastructure development, the transport sector has to count on various funding sources. In the past three years, a private-sector capital amount of around VND165 trillion has been mobilized for 65 projects, Huy said.

The amount included over VND68.56 trillion for 24 projects last year and VND42.57 trillion this year. The expected figure next year will be VND45 trillion.

Huy said huge funding will be needed for not only road projects but also north-south railway development, the planned big-ticket Long Thanh international airport project in the southern province of Dong Nai Province, seaport projects and inland waterway projects across the country.

Huy estimated investments in transport infrastructure development at VND960 trillion in 2014-2020, and ODA and the State budget account for only 47% of the total.

Huy stressed the Ministry of Transport will select financially capable investors to ensure the quality and construction tempo of transport projects to be carried out in the coming years.

Toll fees for road projects are decided based on existing regulations and levels announced by the Ministry of Finance. Huy said the ministry will calculate reasonable toll fees to harmonize the interests of both investors and the State.

Huy noted that more tollgates will go up on National Highway 1 next year when the expansion of this north-south road is completed. However, the transport ministry will only allow tollgates to be set up 70 kilometers apart as required by the finance ministry.  

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