Ministry seeks ways to spur transport projects

The Ministry of Transport will work in close collaboration with banks, investors, contractors and material suppliers so as to hasten the pace of transport infrastructure projects which are currently suspended given public spending cuts.

The connection is aimed at speeding up the execution of delayed projects and helping material suppliers to ease mounting inventories, said Transport minister Dinh La Thang in a meeting last week. The meeting was attended by representatives of Bank for Investment and Development of Vietnam (BIDV), project owners and building materials suppliers.

However, the programme only targets transport projects backed by official development assistance, state budget and government bonds with completion planned for between now and 2014.

BIDV suggested participating investors to open deposit accounts at the bank and use its services. They must satisfy the bank’s criteria on credit rating and credit supply conditions in line with the central bank’s regulations.

In the context that many transport projects have been put on hold due to capital shortage, the move is expected to remove bottlenecks in capital mobilisation and construction pace. However, some enterprises are concerned about credit rating, collateral and other issues.

In the current tough economic conditions, enterprises find it hard to meet requirements of banks, said Vu Hai Thanh, general director of Civil Engineering Construction Joint Stock Co. No. 8. Thereby, it is still difficult for borrowers to acquire loans to secure the completion of their transport projects.

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Category: Business