From nothing to leading highway investor

"Running and queuing at the same time", racing to meet project investment progress

Since its inception, Vietnam Expressway Corporation (VEC) has shouldered the heavy task and great expectation of being a core enterprise in the investment of the national expressway system.

Mr. Tran Xuan Sanh, former Chairman of the Board of Directors and General Director of VEC (Photo: Ta Hai).

VEC's business operations are: Investment - Exploitation - Capital Repayment and Ownership.

Although the model is similar to Korea Expressway Corporation and Japan's KEC and NEXCO, the initial investment for VEC is not the same as Korea and Japan.

While the charter capital assigned by the Government of the neighboring country is 5 billion USD, VEC is only assigned charter capital through the right to collect tolls on National Highway 1 at Cau Gie and Phu Dong stations for a period of 10 years.

In the early days of establishment, facing numerous difficulties, starting from nothing, VEC "went and explored the path", step by step solving the problems of human resources, material resources and mechanisms to have a foundation for development.

Regarding human resources, as a newly established unit, VEC does not have any personnel while the assigned tasks require thousands of workers. Some initial key officials (Chairman of the Board of Members, General Director, Chief Accountant) coordinated with the Department of Organization and Personnel ( Ministry of Transport ) to review human resources in the industry, propose to the Minister to mobilize, arrange, and form the basic apparatus of VEC.

From the initial workforce, propaganda, promotion, and recruitment of labor force continued to be promoted to have enough staff and production lines.

In parallel with the building of the force, the Board of Directors simultaneously started the work of preparing investment projects. During this period, the work was both running and lining up.

In terms of material resources, VEC's initial charter capital is not in cash but in assets, through the right to collect highway tolls worth about 1,000 billion VND, collected within 10 years.

Determining that the only way to collect a large amount of cash at once was to franchise. From there, VEC had to apply for a franchise mechanism. After 3 years of proposals and recommendations, the capital source for initial operations was finally resolved.

During the period when the toll collection rights have not been sold, all operating costs depend on bank loans with high interest rates, partly supported by businesses in the industry through the direction of the Ministry of Transport.

Regarding the operating mechanism and business model, the 1996 Investment Law is not yet sufficient for implementation. The biggest conflict is the imbalance between the charter capital and total investment, VEC's nominal capital is 1,000 billion but VEC has to mobilize 100,000 billion VND. The collateral for loans is also similarly imbalanced and there are some other conflicts.

To resolve the above "bottlenecks", VEC has reported to the Government and ministries and branches. That is also the reason why Decision 1202 on special mechanisms applied to projects invested by VEC was issued.

Launching ceremony of Vietnam Expressway Development Investment Company on December 4, 2004.

5 core issues to create breakthroughs

The challenge is huge, but after only 5 years, VEC has affirmed its expected role and position when it was established, which is to become a core enterprise in investing in expressway projects using commercial loans.

To meet investment resources, VEC had to issue project bonds with an interest rate of 16%/year. However, VEC's business activities have brought about very high socio -economic efficiency.

At that time, VEC had mobilized capital of 5 billion USD, at the same time promoted investment in 5 major expressway projects, with a length of more than 530 km and researched and prepared 3 more projects in the pre-feasibility stage.

Up to now, after 20 years of construction and development, VEC has maintained its leading position in the group of expressway investors in terms of investment volume and value.

The expressways invested and operated by VEC have been actively contributing to the economic development of the country in general and the localities along the expressways in particular.

To overcome difficult times and achieve remarkable achievements, we cannot fail to mention 5 core issues.

Welcoming the 20th anniversary of VEC's founding (October 6, 2004 - October 6, 2024), with the sentiments of a member who was both a key leader and a founding member, I wish all officers, employees and workers of the Corporation to continue to unite, be unanimous, promote the good traditions of previous generations, and bring the Corporation to sustainable development and continuous growth.

Mr. Tran Xuan Sanh

Specifically, VEC has gathered a team of human resources with high professional qualifications and ethics, proficient in work content, especially internationally related work.

Next, thanks to the solidarity and unity of the entire organizational system, from leaders to officers, employees, and workers, we all work towards the goal of building a strong and sustainable Company.

Human resource work is built on the basis of a democratic, transparent and public process, choosing the right person for the right job, the right position and task, associated with clear and coherent work management and administration, a smooth and fluent operation chain, without pushing or backlog of work.

Finally, VEC has built a spirit of dedicated work for its staff, employees and workers, regardless of day or night. That spirit is not only promoted within VEC but also inspires staff from ministries, branches and international friends.

Mr. Tran Xuan Sanh

Former Chairman of the Board of Directors and General Director of VEC

Source: https://www.baogiaothong.vn/tu-hai-ban-tay-trang-den-nha-dau-tu-cao-toc-hang-dau-192240926095857345.htm