This is also the most important highlight of the Report on the results of appraisal of the adjusted financial plan of the Hanoi - Hai Phong Expressway Project by the Vietnam Infrastructure Development and Financial Investment Corporation (Vidifi), which has just been submitted to the Prime Minister for consideration and decision by the Ministry of Transport.

At the time the appraisal report consisting of 19 A4 pages was sent to the Prime Minister, the Ministry of Transport said it had received the assessment of the Ministry of Planning and Investment, and the opinion of the verification unit is the Institute of Construction Economics (Ministry of Construction).

It should be added that, in order to ensure financial feasibility for the largest infrastructure project in the Red River Delta region with a total investment approved after being approved by the Prime Minister of VND 45,487 billion, Vidifi proposed a package of support mechanisms and policies, including 9 conditions that are considered necessary and sufficient.

The Hanoi - Hai Phong Expressway project will be opened to traffic at the end of this year

According to assessments of ministries and branches, basically, these proposals are not outside the financial and support mechanisms approved by Deputy Prime Minister Hoang Trung Hai in Notice 197/TB - VPCP dated May 12, 2014 as well as the BOT Contract signed in 2008.

Among these, the most prominent is Vidifi asking the Government to allow restructuring of two loans worth about 300 million USD from the Export-Import Bank of Korea and 100 million USD from the German Reconstruction Bank (KFW) into the form of direct State investment in the Project.

This is also a support mechanism that has precedent when applied in the process of restructuring 5 highway projects invested by Vietnam Expressway Development Investment Corporation (VEC) and allowed by Vidifi to be applied by Deputy Prime Minister Hoang Trung Hai (Notice 197).

Besides, according to the assessment of the appraisal agency, the Hanoi - Hai Phong Expressway Project is similar to other transportation infrastructure projects, it is a key work and project with great socio-economic significance, but to ensure financial feasibility, the projects need partial support from the State.

Because the implementation support capital is not included in the total investment capital, the appraisal agency accurately revised the total investment capital to 34,899 billion VND as a basis for calculating the project's financial plan.

"For some of Vidifi's recommendations, in addition to Notice 197 and the Contract, such as allowing Vietnam Development Bank (VDB) - the main shareholder at Vidifi, to borrow a balance during the first 5 years of project operation, sliding exchange rates and interest rates to borrow USD is well-founded and necessary," Deputy Minister of Transport Nguyen Hong Truong affirmed.

On behalf of the appraisal agency, Deputy Minister Truong said that Vidifi's proposal to adjust and update the financial plan if the average exchange rate every 5 years fluctuates more than 6%/year or less than 2%/year is reasonable, because investors cannot control exchange rate risks for foreign currency loans.

Regarding the fee - the main source of revenue of the project that Vidifi proposed is 2,000 VND/km/standard vehicle, the toll collection period starts from 2016, the appraisal agency affirms that the investor has the right to decide the fee each period, to ensure capital return. However, the two ministries of Transport and Planning and Investment recommended that Vidifi build a reasonable toll collection route to attract vehicles onto the highway.

It is known that with newly updated input factors, including the assumption that support mechanisms and policies are officially approved by the Prime Minister, during the 30-year toll collection period, the Project's financial internal rate of return ranges from 9.41% to 9.78%; Current net value ranges from VND 5,356 billion to VND 6,945 billion depending on whether the domestic currency depreciation compared to foreign currency by 4% during the exploitation period is considered or not.

"These indicators show that the project can balance cash flow, repay loans and is attractive enough to investors in case Vidifi considers the project's concession plan," said Mr. Nguyen Ngoc Long, Vice President of the Vietnam Association of Bridge and Road Science and Technology.

Previously, according to Decision 1621/QD-TTg of the Prime Minister on a number of pilot mechanisms and policies for investment in the Hanoi - Hai Phong Expressway Project, Vidifi - a joint stock company controlled by VDB as the investor of the project was implemented in the form of this BOT contract.

In addition to its own capital of about 5,000 billion VND, Vidifi is allowed by the Prime Minister to borrow foreign capital and domestic credit capital to invest. To pay back capital, this investor was granted a number of land funds to develop industrial parks, urban areas and collect tolls on National Highway 5 and the main highway.

The Hanoi - Hai Phong high-speed automobile route is a vital route in the Northern Delta, with a very large traffic volume. Therefore, the project is receiving attention from domestic and foreign investors and the investor is submitting to the competent state agency to consider transferring part or all of the project.

According toMr. Minh
Baodautu.vn