Vietnam Approved $1.25 Billion Metro Line in Ho Chi Minh City

The Vietnamese government has approved plans to build an underground metro line in Ho Chi Minh City at a cost of $1.247 billion, the Ministry of Transportation said Friday. Deputy Prime Minister Nguyen Sinh Hung has approved the project being funded using loans from three foreign banks, the ministry said in a statement.

By on October 13, 2009 • Topics: Business & Tech,News

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According to the Dow Jones Newswires, the Vietnamese government has approved plans to build an underground metro line in Ho Chi Minh City at a cost of $1.247 billion, the Ministry of Transportation said Friday.

Deputy Prime Minister Nguyen Sinh Hung has approved the project being funded using loans from three foreign banks, the ministry said in a statement.

Vietnam will borrow from the Asian Development Bank, German state-owned bank KFW, and the European Investment Bank, the statement noted, giving no details about each of those loans.

The ministry didn’t provide any timetable for the construction or operation of the metro line.

The plan may be part of an effort to relieve Ho Chi Minh City of congestion due to overpopulation by redirecting citizens to the surrounding areas.  Ho Chi Minh City has a population of over 7 million and density of over 8,800 per square mile, making it one of the top 25 densest cities in the world.

The Author:

Quyen is currently an Investment Analyst at a real estate private equity firm. She previously worked in real estate investment banking covering a variety of transactions, including equity, debt and M&A. Quyen graduated from the University of California, Berkeley with a B.S. in Business Administration and a B.A. in Economics.

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  • Brian

    Oh my gosh. This is WONDERFUL NEWS! So many problems can be addressed with the installment of a subway system. I wonder if we have the technical know how to do something like this. This seems like a 10 year project or something haha.

  • http://www.onevietnam.org James H. Bao

    It’s about time!

  • 2VER

    It’s great news that Vietnam is making progress; however, I’m skeptical of the project. How will they build the underground metro especially when Vietnam faces monsoon seasons annually? Unlike the US, Vietnam doesn’t have the drainage system infrastructure to prevent flooding during raining seasons. Will the project guarantee standard operations, or standard responses to emergency?

    Even if the project is up to par, will the Vietnamese willing to give up their mopeds for the metro and what is the ridership required to offset the loan? Also, long term problems may arise such as squatters and crime violence around the stations; how will government prevent those?

    Of course, now is the time to spend on the country’s infrastructures like major industrialized countries, but an evaluation of possible risks could lowered Vietnam’s losses.

  • Le-Quyen Le

    @2VER — I think you’re absolutely correct in voicing these concerns, which will arise throughout the planning, construction and operating stages. The government will need to address these issues and we hope to follow up on this development with more concrete data should they be published.

  • Pingback: HCMC’s Congestion as an Opportunity to Refocus | Vietnam Talking Points

  • Rail Signal Solution

    Great news. Subway will help a lot.
    Hopefully, my company gets a contract with them. Would be great to go back and work there, wouldn’t it?