The Ministry of Transport has outlined several strategies to mobilize the $67.34 billion needed for the North-South high-speed rail project, slated for completion by 2035. Proposed funding solutions include government bonds, domestic and international investment, and other sources with minimal restrictions.

The Ministry’s pre-feasibility report for the project, presented to the government for submission to the National Assembly, highlights a capital allocation plan over 12 years, with an estimated annual investment of $5.6 billion.

Deputy Minister of Transport Nguyen Danh Huy stated that, considering Vietnam’s economic scale and current public debt levels, the Ministry of Transport has worked closely with the Ministry of Finance to assess the project’s fiscal feasibility.

Additionally, the Ministry has collaborated with the Ministry of Planning and Investment to evaluate capital balancing and conduct other assessments, showing that securing funds for this massive infrastructure undertaking is feasible.

According to the Ministry, diverse legal funding sources will be mobilized for the project. The Ministry recommends several specific mechanisms, including the use of government bonds, official development assistance (ODA), preferential foreign loans, and legitimate domestic sources.

The project will be funded across multiple mid-term public investment cycles, aligning with the project's phased schedule. In case of necessary adjustments, the Prime Minister can reallocate central budget funds among ministries, agencies, and localities without altering the total approved annual mid-term capital.

Four key funding solutions

Speaking at the "High-Speed Railway: Opportunities and Challenges" forum hosted by the Government Portal on October 29, Deputy Minister of Finance Bui Van Khang outlined four primary funding strategies:

1. National Five-Year Financial Plan  

   - A national financial plan in three stages through 2035, emphasizing balanced resource allocation to ensure the full budgetary commitments for public spending under the State Budget Law. This plan will prioritize funding for national and key transport projects, including the high-speed rail, combining central and local budgets.

2. Issuing Government Bonds  

   - To attract capital, the government plans to issue bonds with interest rates aligned to market conditions and the project’s timelines.

3. Attracting Domestic Investment, Including Public-Private Partnerships (PPP)  

   - To diversify local investment sources, the project aims to incorporate PPPs as a sustainable model for public infrastructure development.

4. Securing High-Preference International Investment  

   - International funding sources with favorable conditions, reasonable terms, and minimal constraints will also be pursued.

With these approaches, Deputy Minister Khang expressed confidence in the financial readiness for the high-speed rail project, ensuring resources are available as needed.

In an interview with VietNamNet, Professor Hoang Van Cuong, a member of the National Assembly’s Finance and Budget Committee, emphasized the need for special mechanisms to mobilize and focus funding for this project. He stressed that despite the high capital requirements, priority must be placed on ensuring continuous funding throughout the project.

Professor Cuong highlighted possible funding options, such as increasing public debt, issuing government bonds to attract domestic resources, and even considering international bond issuance to engage global investors.

N. Huyen