Major Expansion of Ho Chi Minh City-Trung Luong-My Thuan Expressway
Introduction
Metro Pacific Tollways Corp.’s Vietnamese affiliate, CII Bridges and Roads Investments Joint Stock Co. (CII B&R), is gearing up for a transformative project: the $1.53 billion expansion of the Ho Chi Minh City-Trung Luong-My Thuan Expressway. With construction slated to kick off by September 2025, this expansion is set to weave a vital thread connecting Southern Vietnam’s bustling commercial hub to the serene landscapes of the Mekong Delta.
Project Overview
The expansion involves the addition of approximately 96 kilometers to the existing expressway. Notably, this will include new sections north of the My Thuan 2 Bridge located in Tien Giang Province. This corridor is critical not just for local transportation but also for regional economic activities, facilitating trade and enhancing connectivity between urban and rural areas.
Government Involvement and Financing Strategy
In a notable shift from usual protocol, the Vietnamese government has chosen to directly appoint CII as the investor for this project, bypassing the typical competitive bidding process. Le Trung Hieu, director of Capital Management at CII, commented on this accelerated approach during a recent roundtable, highlighting the government’s commitment to speeding up critical infrastructure projects.
The overall investment breakdown is essential for understanding the scope of this undertaking. The estimated costs are ₫23.5 trillion for construction and equipment, ₫4.4 trillion earmarked for land clearance, and ₫4.8 trillion allocated for interest during construction. CII plans to finance the project with a strategic mix: 15% equity and 85% debt, with loans averaging an interest rate of 10.75% annually.
Project Timeline and Capital Expenditure
The capital expenditure for the project is primarily set to be deployed between 2026 and 2028. Interestingly, the outlay for the current year will focus mainly on site clearing and preliminary works. “We don’t need a lot of capex this year—just enough to kickstart the project,” Hieu remarked, underscoring a phased approach that aims to mitigate risks while laying a solid foundation for future spending.
Challenges and Administrative Reforms
Vietnam’s ambitious infrastructure plans have long been hampered by issues such as land acquisition delays and complex local government mandates. However, recent administrative reforms are reigniting hope for smoother project execution. The proposed merger of Ho Chi Minh City with neighboring regions like Binh Duong and Ba Ria-Vung Tau is designed to enhance inter-provincial coordination, which could prove beneficial for expediting project approvals and land acquisitions.
Strategic Implications for Regional Development
CII’s partnership with Metro Pacific Tollways Corp. aligns seamlessly with a broader regional strategy aimed at expanding toll road investments in Southeast Asia. Focusing particularly on markets like Vietnam and Indonesia, the collaboration not only reinforces CII’s standing in Vietnam’s infrastructure landscape but also positions it well for future opportunities in a rapidly growing economy.
Significance of the Expressway Expansion
This expressway expansion holds considerable significance for the southern region. By improving transportation links, it promises to bolster the economic viability of the Mekong Delta, enhancing access for agricultural goods and easing the flow of traffic between rural and urban centers. As the expressway connects major economic zones, it may also attract further investments to the area.
By meticulously planning and executing this significant infrastructure project, CII B&R and its partners aim to contribute not just to immediate logistical improvements but also to the long-term economic landscape of Vietnam. As the development unfolds, it will be intriguing to observe how these efforts reshape the region’s connectivity and economic dynamics.