VietNamNet Bridge  – HCM City will need as much as US$40 billion for transport infrastructure development between now and 2020 to meet public demand and address chronic traffic jams, and most of it remained to be sought, an official said on Wednesday.

HCM City’s Vice Chairman Nguyen Trung Tin (R) answers queries about the city’s business

“The city’s state budget can cover only 15-20% of the huge investment capital,” said Bui Xuan Cuong, deputy director of the city’s Department of Transport, after discussions held by the European Chamber of Commerce in Vietnam (EuroCham) in collaboration with local agencies. The meeting was held for the city government and its departments to answer queries raised by members of business groups.

To find the capital balance, Cuong said HCMC would have to count on sources and forms of investment, including official development assistance (ODA) loans, build-operate-transfer (BOT), build-transfer (BT) and private-public partnership (PPP) for roads and public transport projects in line with a zoning plan already approved by the Government.

HCMC is working with the Ministry of Planning and Investment over selecting and implementing certain projects on a pilot basis, with high hopes that PPP will be one of the effective channels to attract significant capital given limited funds for infrastructure projects.

Alain Cany, chairman of EuroCham in Vietnam, said capital for infrastructure projects was not in short supply but the problem was the lack of transparency, clear and consistent regulations and a proper mechanism for companies to join and have a return of investment.

Cany told the Daily on the sidelines of the event that foreign investors still complained about difficulties in having certain projects licensed in HCMC and that this took more time here than other localities. This was one of the reasons why HCMC ranked lower in the Provincial Competitiveness Index 2010 (PCI) survey than in previous years.

The PCI survey, organized by the Vietnam Chamber of Commerce and Industry (VCCI) and the U.S. Agency for International Development’s Vietnam Competitiveness Initiative (USAID/VNCI), showed HCMC dropped seven places to 23rd and for the first time was not among the 22 provinces and cities in the Excellent and High Tiers of the PCI.

However, HCMC’s Vice Chairman Nguyen Trung Tin said the city had been leaders in the number of domestic and foreign direct investment (FDI) projects, and this was evidence of the city’s good business environment.

Tin said a number of projects, whose owners had to wait too long for a license, were an exception. He clarified the city was aiming for projects that use high and environment-friendly technology but less unskilled workers and turn out highly added-valued and competitive products.

According to the HCMC Department of Planning and Investment, the city has attracted total registered capital of over US$1.3 billion from new and operational projects last year, up 250% year on year. Overall, the city has licensed 3,857 FDI projects with combined capital pledges of US$29.4 billion from 1988-2010.

Questions about the solutions to traffic congestion were also raised at the dialogue, which drew some 100 participants. Cuong of the transport department pointed out underdeveloped public transport infrastructure was one of the reasons people use their own vehicles.

Cuong said there were some 5.1 million individual vehicles in HCMC, including 4.6 million motorbikes. In addition to measures to limit individual vehicles on roads, the city will focus available capital sources on major transport infrastructure projects, including the beltway that is already connected to Phu My Bridge and will soon run into Hanoi Highway.

Funds will go to gateway highways; roads linking ports, industrial parks and export processing zones; and expressway sections from HCMC to Long Thanh and Dau Giay. Cuong said the Long Thanh-Dau Giay section was to open to traffic in the next two years.

HCMC will also give priority to six metro lines that are 110 kilometers long and three monorail or tramway systems with some 45 kilometers in length. Cuong said the city expected to operate the first metro line stretching 19.7 kilometers from Ben Thanh to Suoi Tien in early 2016.

The city will re-arrange the current fleet of 3,096 buses and 148 bus routes as well as make every effort to open the three monorail or tramway systems to traffic in the next five years to meet 15% of the public demand instead of only 7-8% currently.

Source: SGT