The Ho Chi Minh City-Mo Bai City Expressway is a major infrastructure project in southern Vietnam that aims to improve connectivity and boost trade with Cambodia. The latest cost estimate for the project is VND16.73 trillion (USD709.9 million), an increase of VND6 trillion (USD255 million) from the end of 2019. Despite the significant cost increase, the project is expected to play an important role in connecting Ho Chi Minh City and Cambodia, freeing up traffic congestion on National Road 22, and boosting economic growth in the region.
background
The Ho Chi Minh-Mo Bai Expressway is a 53.5-kilometer (33.2-mile) toll road that will connect Ho Chi Minh City to the Mo Bai International Border Crossing, a major border crossing point between Vietnam and Cambodia. The project was initially estimated to cost VND10.7 trillion at the end of 2019, but the cost increased to VND15.9 trillion in May 2020 and now to VND16.73 trillion due to various factors including inflation, design changes and the relocation of local residents.
According to a pre-feasibility report submitted by the Ho Chi Minh City People's Committee to the Ministry of Planning and Investment, the expressway will have at least four lanes, a maximum speed of 120 km/h (74.6 mph), and will be constructed as a build-operate-transfer (BOT) project, with investors receiving a return on their investment within 18 years and one month. Site clearing is expected to begin in the fourth quarter of 2023, construction to start in 2024, and completion is expected in 2027.
Once completed, the Ho Chi Minh City-Mo Bai Expressway is expected to significantly reduce travel time between Ho Chi Minh City and the Mo Bai border crossing, facilitating the flow of goods and people between the two countries. In addition, the project will play an important role in connecting Ho Chi Minh City and Cambodia, easing traffic congestion on National Highway 22 and promoting economic growth in the region.
Benefits of Ho Chi Minh City-Mo Bai Expressway
The Ho Chi Minh City-Mo Bai Expressway project is expected to bring numerous benefits to southern Vietnam and Cambodia. Once completed, the 50-kilometer expressway will relieve traffic pressure on the existing National Highway 22, which runs from Ho Chi Minh City to Mo Bai Border Gate in Vietnam's Tay Ninh Province and connects with Ba Vi Border Gate in Cambodia's Svay Rieng Province. With a designed speed of 120 kilometers per hour, the expressway will promote the socio-economic development of key economic zones in southern Vietnam, including Ho Chi Minh City.
In addition, the project will bring significant improvements to the region’s transport network, reducing travel time and strengthening connections between Vietnam and Cambodia. National Highway 22 is also part of the Asian Highway Network, and the completion of the highway will provide an important connection point for this network, benefiting the wider region.
The Ho Chi Minh City-Mo Bai Expressway will be implemented as a public-private partnership project with a total investment cost of US$711 million. Funds from the budgets of Ho Chi Minh City and Tay Ninh will account for about 44% of the project investment, while private investors will be responsible for the remaining 56%, with the investment recovered through toll collection in 18 years and 1 month.
The project is expected to bring many investment opportunities to the region, with PHI Group recently registering an investment in the project. As a major infrastructure project in Vietnam, the expressway is expected to contribute to the country's ambitious infrastructure development goals, with estimates suggesting that Vietnam may require a total investment of $605 billion to achieve 83% of its infrastructure targets by 2040. Urban transportation, roads, railways and port infrastructure are among the sectors with the highest priority for investment.
Challenges and criticisms
The Ho Chi Minh City-Mo Bai Expressway project faces several challenges in its implementation. The southern province of Tay Ninh has approved the resolution to implement the project, but Ho Chi Minh City has not yet determined the time to start the project. Delays in the approval process for the implementation of investment policies will increase site clearing costs and may result in capital losses due to high material prices.
In addition, according to the Ho Chi Minh City Transportation Department, the cost of site clearance currently accounts for about 47% of the total project investment. Ho Chi Minh City has released a list of 28 transportation projects that will be focused on construction and investment from now to 2025, including Ring Roads 2, 3 and 4, Ho Chi Minh City-Chuan Thanh Expressway and Can Gio Bridge. Among them, the Ho Chi Minh City-Mo Bai Expressway project has not yet started due to bottlenecks related to administrative procedures.
However, Ho Chi Minh City is working to speed up the implementation of the project, completing the procedures for approving the investment policy by 2023. The delay in project implementation is also attributed to the high cost of site clearance and materials. In addition, Ho Chi Minh City is focusing on completing other key transportation projects, including the Ben Thanh-Suoi Tien metro line, Ring Roads 2, 3, and 4, and the Ho Chi Minh City-Xuan Thanh Expressway.
To speed up the implementation of these projects, Ho Chi Minh City has proposed allowing independent public investment projects to be reviewed and decided within the prescribed scope for compensation, resettlement and site clearance along transportation routes. The city plans to complete the required work to determine which projects will be implemented in the first quarter of 2023 and which projects may not be completed.
in conclusion
The Ho Chi Minh-Mo Bai Expressway is a major infrastructure project that has the potential to transform transportation networks in southern Vietnam and Cambodia and drive economic growth. The project has faced challenges and criticism, including environmental issues, socio-economic impacts, cost-effectiveness, and project delays. However, many in the region are eagerly awaiting its completion as it is expected to reduce travel times, improve connectivity, promote trade and investment opportunities, and stimulate economic growth in surrounding areas.
The Ho Chi Minh City-Mo Bai Expressway is also expected to benefit the Cambodia Manhattan Special Economic Zone, a key economic development zone in southern Vietnam. The railway will help reduce container transit time and improve traffic flow between the Cambodia Manhattan Special Economic Zone and Saigon Port. Once completed, the Phnom Penh-Bavet Expressway will reduce travel time between Phnom Penh and the Cambodia Manhattan Special Economic Zone to about 90 minutes, which is expected to increase trade and investment opportunities between Cambodia and Vietnam.
Despite the challenges and criticisms, the Ho Chi Minh City-Mo Bai City Expressway remains a vital infrastructure project for the region's economic development. Its successful completion will have a significant impact on transportation networks, trade and investment opportunities, and economic growth in southern Vietnam and Cambodia.
As a company operating in the region, we are excited about the potential benefits of the Ho Chi Minh City-Mo Bai Expressway and are committed to supporting its development. We believe it will contribute to the growth and development of the region, improve the living standards of the local people, and promote economic integration between Vietnam and Cambodia.