More Investors Want To Sell Giant BOT Projects To The Govt

Investors want to sell BOT projects to the government

Cienco 4, Tuan Loc and Truong Loc, the initial investors of Thai Nguyen – Cho Moi BOT (build-operate-transfer) project, capitalized at VND2.713 trillion, has sent word intimating that they want to transfer the project, which is facing difficulties.

After three months of implementing fee collection at one of two collection stations of the projects, the investors collected only VND6.6 billion. The investors anticipated that the fee collection would be not high enough to cover bank loan interest which would drive them to bankruptcy.

The investors have suggested two solutions. First, they want the Ministry of Transport (MOT) to collect the fee on both the new Thai Nguyen – Cho Moi route and Highway No 3.

As a toll collection station has been set up on the new route, vehicles prefer to use on the old Highway No 3 to avoid the fee. As a result, the highway has heavy traffic.

Second, the investors suggested MOT buy the project at VND2.775 trillion. Prior to that, some other BOT project developers also intended to transfer the entire project to the state because of problems.

Viet Tri Bridge BOT JSC, the investor of the Hac Tri Bridge project in Phu Tho, said since August 1, 2016, the volume of vehicles going through the Hac Tri Bridge has reduced sharply. 

As a result, the company could collect VND170-200 million worth of fees each day. Meanwhile, it needs to collect VND300 million at least to cover expenses and take back the investment capital.

Under the initial investment plan, once Hac Tri Bridge is set up, MOT will prohibit vehicles from circulating on Viet Tri Bridge, which is old and degrading. If so, vehicles will have to go on Hac Tri and the investor will be able to collect fees.

However, amid the public’s protests, the watchdog agency decided to allow vehicles with less than seven seats to keep rolling on Viet Tri Bridge. Vehicles travel on Viet Tri Bridge to avoid the fee.

After many discussions, MOT and the investor still have not found solutions to settle the problems.

The investor of the Hanoi-Hai Phong Highway project continues to complain about losses. Vidify reported a loss of VND1.756 trillion in 2016, i.e. VND5 billion each day.

US$1=VND22,000

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Thanh Mai