Nam Dinh - Thai Binh Expressway PPP Project: Need special mechanism to remove difficulties in contract guarantee

More than 2 months since the groundbreaking ceremony, the investor of the PPP Project for Investment in Construction of Ninh Binh - Hai Phong Expressway, section through Nam Dinh Province (now Ninh Binh Province) and Thai Binh Province (now Hung Yen Province) - abbreviated as the Nam Dinh - Thai Binh Expressway PPP Project has still not been able to submit a contract performance guarantee to the competent state agency.

Need special mechanism

Hopes for resolving the credit capital problem of the Nam Dinh - Thai Binh Expressway PPP Project are being raised, if following the latest direction of Prime Minister Pham Minh Chinh. In Official Dispatch No. 6715/VPCP-KTTH, the Prime Minister assigned the Ministry of Construction to urgently study the recommendations of Geleximco Group on credit capital for the Project, and report to the Government Standing Committee.

Geleximco is the leading enterprise of the consortium selected by the People's Committee of Thai Binh province (now the People's Committee of Hung Yen province) as the investor of the Nam Dinh - Thai Binh Expressway PPP Project, with a total investment of up to 19,784.54 billion VND. The project started on May 12, 2025 and was requested by the head of the Government to shorten the time, striving to exceed the schedule by at least 6 months, so that it can be completed in 2026.

In Document No. 1060/CV-GELE, Geleximco Group stated that the investor and project enterprise are very determined to direct the construction; the contractors also showed their determination by mobilizing machinery, equipment, human resources, and materials to organize the construction immediately after receiving the site handover from the locality. However, all efforts have not been recognized by the competent authority, as the investor has not been granted a guarantee to perform the Contract.

Meanwhile, Article 5 - Contract validity of BOT Contract No. 01/2025/HD.BOT-CT08 signed on May 8, 2025 between Thai Binh Provincial People's Committee and the investor consortium stipulates that the contract is effective from the day following the date the contract performance guarantee certificate has come into effect and is duly submitted by the investor and project enterprise to the competent authority.

This means that, up to this point, after more than 2 months since the commencement date, the validity of BOT Contract No. 01/2025/HD.BOT-CT08 has not been activated, causing difficulties for both investors, project enterprises and competent state agencies in implementing the next steps of the Nam Dinh - Thai Binh Expressway PPP Project.

Therefore, in Document No. 1060/CV-GELE, Geleximco Group proposed that the Prime Minister consider and direct competent authorities to have solutions to remove difficulties and have specific mechanisms for national key projects so that investors can borrow credit capital from credit institutions with state-owned capital (VDB, Vietcombank, BIDV, VietinBank, Agribank ), the first step is to guarantee the performance of the contract, followed by procedures related to disbursement of credit capital for the project.

Geleximco will use other legal financial sources of the Group to supplement the repayment source for loans (especially in the first 15 years of operation) to ensure the financial feasibility of the Project. “The timely removal of the above-mentioned obstacles also creates a premise for other expressway PPP projects to access credit capital quickly and conveniently, as a basis for organizing construction to ensure quality and progress,” said Mr. Vu Van Tien, General Director of Geleximco.

Large credit demand

According to Decision No. 766/QD-UBND approving the results of selecting investors to implement the Nam Dinh - Thai Binh Expressway Project under the PPP method, BOT contract type, in addition to the State's capital participation, the investor's capital, the project enterprise is responsible for arranging 10,447.55 billion VND. If excluding the project enterprise's equity capital, the credit capital that investors will have to mobilize for the project is up to 8,000 - 9,000 billion VND.

With the toll collection and capital recovery period of the Project being up to 25 years and 4 months, this is most likely the reason why banks have certain hesitations in providing contract performance guarantees, as well as participating in commercial loan financing for this project.

It is known that since the signing of BOT Contract No. 01/2025/HD.BOT-CT08, the competent state agency of the Nam Dinh - Thai Binh Expressway PPP Project has issued documents 3 times requesting the consortium of investors and project enterprises to complete procedures and submit performance guarantees for the BOT project contract according to regulations.

In Official Dispatch No. 249/UBND-KT1 dated July 17, 2025, the People's Committee of Hung Yen province requested Geleximco Group (representative of the investor consortium) and Nam Dinh - Thai Binh Expressway Investment Joint Stock Company (project enterprise) to urgently complete procedures, submit performance guarantees for the BOT project contract as prescribed and send the results of the dossier and documents to the Construction Investment Project Management Board No. 2 before July 30, 2025 to carry out the following tasks, meeting the overall progress of the project.

“The Management Board of Construction Investment Project No. 2 shall check the legality and manage the contract performance guarantee of the Investor/Project Enterprise Joint Venture in accordance with the provisions of law and the BOT Project Contract; monitor the contract performance guarantee period to ensure compliance with the project implementation progress,” the leader of the Hung Yen Provincial People's Committee requested.

Source: https://baodautu.vn/du-an-ppp-cao-toc-nam-dinh---thai-binh-can-co-che-dac-thu-go-kho-bao-lanh-hop-dong-d338254.html