The MoT had approved feasibility studies and is selecting technical consultants for 11 sections with a combined length of 657 km from the north to the south, Minister of Transport Nguyen Van The has said. 

The noted that his ministry wants to finish the selection of contractors this year so that work can begin next year and in 2021.

Half of the total investment or VND55 trillion (US$239 million) will come from the state budget and the remaining from banks, according to the minister. 

Of the total projects, three ones namely Cao Bo-Mai Son (US$215 million) connecting the northern provinces of Nam Dinh and Ninh Binh, Cam Lo-La Son (US$342 million) in the central provinces of Quang Tri and Thua Thien-Hue, and My Thuan 2 bridge (US$215 million) in the southern province of Vinh Long which all using the state budget would be kicked off in the second quarter and fourth quarter 2019. 

The eight remaining projects are expected to start in 2020. 

Hard to get loans 

However, the ministry finds it hard to get loans for the projects due to regulations on interest rates and on the government’s guarantee. 

Vietnamese regulations only allow a maximum loan interest rate of 7.72% per year for the works, lower than the current 10.5-11% market rates. 

In a report to the National Assembly last October, the ministry said this was creating difficulties for investors. If the Ministry of Finance could amend regulations and increase the ceiling to 10.5%, it would help attract investment, the report said.

In addition, an eligible investor must fund at least 20% of the investment with its equity when investing in a north-south expressway project under the build-operate-transfer (BOT) form. 

Hanoitimes