According to deputy transport minister Ngo Thinh Duc, the Dau Giay-Phan Thiet expressway would be the first project to be developed under the public-private partnership (PPP) form, with investment capital estimated to US$745 million. Bitexco expects to complete the road within 36 months.

Under the contract, Almec-Tedi will conduct research and draw up a feasibility study, including an investment plan for the expressway. The consultant consortium will also draw up a technical design, a site clearance and resettlement plan and a report appraising the effects of the project on the environment. The US$1.5 million deal will be carried out over six months.

After completing the feasibility study and technical design, the developer will submit them to the transport ministry and construction is expected to begin early next year.

Speaking at the signing ceremony, Bitexco chairman Vu Quang Hoi mentioned the need to build the Dau Giay-Phan Thiet expressway in the context of social-economic development in the south central region and as a solution to the chronic traffic congestion on National Highway 1. The road is also part of the long-term strategy to develop the north-south expressway.

Transport deputy minister Duc encouraged the involvement of private investors in developing infrastructure projects in the country.

Last May, the government added Dau Giay-Phan Thiet to the list of projects seeking loans from the International Bank for Reconstruction and Development (IBRD), a financial institution under the World Bank (WB). After that, the Ministry of Planning and Investment sent a diplomatic note to the WB to propose adding Dau Giay-Phan Thiet expressway to the priority list of projects financed by IBRD, paving the way for the trial PPP form in the country’s infrastructure sector.

Transport experts told the Daily that the PPP form would help to reduce the ministry’s financial burden in mobilizing funds for expressway projects. The decision also paved the way for Bitexco, which specializes in garments, hydro-power development and real estate, to expand into the infrastructure sector.

The Dau Giay-Phan Thiet expressway will have a total length of 128 kilometers, according to the country’s expressway development master plan until 2020 prepared by the transport ministry. The six-lane road, which is scheduled to open to traffic by 2014, will allow vehicles to reach a maximum speed of 120 kilometers per hour.

The road will connect the planned HCMC-Long Thanh-Dau Giay expressway to Phan Thiet City, thus creating a strong communication route between the southern economic zone and Binh Thuan and facilitating the development of new urban townships, economic zones and tourism facilities.

Bitexco is the developer of large-scale property projects in Hanoi and HCMC such as The Manor, the Financial Tower, Ma Lang complex and Ben Thanh Twin Towers. The developer has completed the first phase of Thanh Hoa By Pass Road under the build-operate-transfer (BOT) form and that project will be finished in September.

The Transport Ministry is also seeking WB loans for two other expressways, the US$960 million Ninh Binh-Thanh Hoa and the US$1 billion Danang-Quang Ngai.