Proposal to apply special mechanism for Cam Lo expressway

The PPP project to invest in the construction of the Cam Lo - Lao Bao expressway in Quang Tri province is 56 km long, has a scale of 4 lanes, and a total investment (excluding interest during construction) of 13,726 billion VND.

Illustration photo.

The People's Committee of Quang Tri province has just sent Document No. 18/TTr - UBND to the Prime Minister requesting to apply special mechanisms and policies and budget support to participate in the PPP project to invest in the construction of Cam Lo - Lao Bao expressway, Quang Tri province.

In this submission, the People's Committee of Quang Tri province proposed that the Prime Minister consider submitting to the National Assembly permission to apply special mechanisms and policies to the PPP project to invest in the construction of the Cam Lo - Lao Bao expressway in Quang Tri province with the state capital participation rate in the project being 70% of the total investment.

In the context of limited resources in Quang Tri province, in order to soon complete the procedures to implement the Project to be completed before 2030 according to the approved orientation and planning, the People's Committee of Quang Tri province proposed that the head of the Government pay attention to supporting and allocating capital from the central budget in the medium-term period of 2026-2030 as the state capital participating in the PPP Project to invest in the construction of Cam Lo - Lao Bao expressway, which is 9,608 billion VND; at the same time, add the Project to the List of key national works and projects, key projects of the Transport sector.

According to the Pre-Feasibility Study Report of the Cam Lo - Lao Bao Expressway Construction Investment PPP Project recently completed by the Quang Tri Provincial People's Committee, this project has a total length of 56 km, with the starting point intersecting with the Cam Lo - La Son Expressway and the ending point at the Lao Bao international border gate; passing through 4 districts: Trieu Phong, Cam Lo, Dakrong, Huong Hoa in Quang Tri province.

The project's route is invested in a scale of 4 completed lanes, roadbed width of 24.75m, design speed of 100km/h. The total investment of the project (excluding interest during construction) is 13,726 billion VND. Of which, the project's site clearance cost is 676 billion VND; construction cost is 10,643 billion VND; equipment cost is 222 billion VND; project management, consulting and other costs are 1,086 billion VND; contingency cost is 1,099 billion VND.

The estimated state budget capital participating in the Project is 9,608 billion VND (accounting for 70%); the capital mobilized by investors (Owner, loan capital and other capital) is 4,581 billion VND (accounting for 30%). The Project implementation period is from 2024 to 2028.

Quang Tri Provincial People's Committee said that because the project passes through Huong Hoa, Dakrong, Cam Lo, and Trieu Phong districts with particularly difficult conditions and the forecast of traffic volume in the initial phase is not high, the project's financial plan when applied according to the provisions of Clause 2, Article 69 of the Law on Investment under the PPP method (the proportion of state capital participating in the project does not exceed 50% of the total investment) is not feasible, prolonging the payback period, making it difficult to mobilize capital from investors and credit institutions.

“To ensure feasibility and convenience in attracting non-state budget investment capital under the PPP method, improve the feasibility of the financial plan, shorten the payback period (to 28.7 years), with the participation of state capital accounting for 70% of the total investment of the Project”, the leader of the People's Committee of Quang Tri province calculated.

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