Hanoi (VNA) - With the National Assembly's approval to add 38.25 trillion VND (1.49 billion USD) to the charter capital of the Vietnam Expressway Development and Investment Corporation (VEC) for the 2024-2026 period, VEC's leaders emphasised that this is a crucial opportunity and driving force for the corporation to leverage its advantages, improve operational efficiency, innovate, and develop sustainably.
According to Han Mai Nga, VEC's Chief Accountant, the approval of the additional charter capital is seen as "unlocking the mechanism" to allow VEC to make "breakthroughs" after two decades of overcoming difficulties.
VEC’s initial charter capital was relatively low, just 1 trillion VND when it was established in 2004. Despite two capital increases, by 2021, the company's charter capital stood at over 1.11 trillion VND, while the total investment in five expressway projects amounted to over 108 trillion VND, with more than 56 trillion VND in loans. This created challenges in meeting debt-to-equity ratio requirements, resulting in limited financial capacity for expanding expressways.
This capital constraint made it hard for VEC to raise funds, particularly from financial institutions, for expanding the expressway network and other business activities. In response, the government and relevant ministries provided support to strengthen VEC's financial capacity, but the process of increasing capital faced challenges due to changes in regulations and policies that complicated the process.
The increase in charter capital will create a legal foundation for VEC to manage its expressway assets and facilitate the accounting of these assets, resolving significant operational bottlenecks, freeing up investment resources, and fostering growth, Nga noted.
Truong Viet Dong, Chairman of the VEC Member Council, stated that the corporation will continue implementing its strategic development plan through 2030, with a vision until 2035. VEC aims to expand the expressways it currently manages and operates and develop key sections of the North-South Expressway. The corporation is also preparing to invest in remaining expressway projects in the national plan, aiming to enhance national security, economic development, poverty alleviation, and, by 2035, manage and operate 1,500 km of expressways nationwide.
With the added capital, VEC is now positioned to mobilise resources, including from credit institutions, to expand existing expressways, invest in new projects, and offer services along expressway routes, ensuring progress, quality, and efficiency.
Following the capital increase, VEC’s CEO Pham Hong Quang said the corporation is focusing all resources to speed up the completion and operation of the Ben Luc-Long Thanh expressway’s sections, targeting full completion by 2026. It is also working to finish adjustments and remaining tasks for the Da Nang – Quang Ngai expressway this year.
Additionally, VEC is pushing ahead with repairs and upgrades to the roads and traffic safety systems of several expressways under its management, including Noi Bai – Lao Cai, Cau Gie – Ninh Binh, Da Nang – Quang Ngai, and HCM City-Long Thanh-Dau Giay.
For the Noi Bai – Lao Cai expressway, contractors are currently mobilising personnel and resources to begin 11 repair packages at the end of February.
VEC is actively preparing to begin the expansion of the Noi Bai – Lao Cai expressway (Yen Bai-Lao Cai section) and the Cau Gie-Ninh Binh expressway in Q4.
Moreover, VEC is carrying out studies to invest in and complete services and rest stops along the Da Nang – Quang Ngai and Ben Luc-Long Thanh expressways and implement vehicle weight control systems on the expressways it operates./.
