The Government officially submitted to the National Assembly an additional VND 38,251 billion in charter capital for VEC.

In case the National Assembly allows to add charter capital as proposed by the Government, the parent company - Vietnam Expressway Corporation (VEC) will have a charter capital of VND 39,366 billion.

The Government officially submitted to the National Assembly an additional VND 38,251 billion in charter capital for VEC.

In case the National Assembly allows to add charter capital as proposed by the Government, the parent company - Vietnam Expressway Corporation (VEC) will have a charter capital of VND 39,366 billion.

A section of the Ben Luc - Long Thanh expressway is being accelerated by VEC.

The Government has just issued Document No. 50/TTr-CP to the National Assembly on the plan to invest in additional charter capital for the 2024-2026 period of the parent company - VEC.

Specifically, the Government proposed that the National Assembly allow the use of public investment capital that has been assigned to the Ministry of Transport to invest in projects with an amount of VND 36,689 billion, including VND 10,062 billion of counterpart capital from the state budget, VND 24,127 billion of ODA capital in projects implemented in the form of converting loan capital for re-lending into state budget allocation, VND 2,500 billion of state budget allocation capital for the Noi Bai - Lao Cai and Cau Gie - Ninh Binh projects, to convert into charter capital for the parent company - VEC.

The Government also proposed that the National Assembly approve the investment policy to supplement the charter capital for the parent company VEC in the period of 2024-2026, which is VND 38,251 billion, including VND 1,562 billion from the Enterprise Development Investment Fund and VND 36,689 billion from the state budget (public investment capital has been assigned to the Ministry of Transport to invest in 5 expressway projects invested by VEC and has been disbursed).

It is known that 5 expressway projects invested by VEC include: Cau Gie - Ninh Binh, Noi Bai - Lao Cai, Ho Chi Minh City - Long Thanh - Dau Giay, Da Nang - Quang Ngai and Ben Luc - Long Thanh.

Currently, the parent company - VEC has a charter capital of 1,115 billion VND. In case the National Assembly allows additional charter capital for the period 2024 - 2026 as per Resolution No. 19, the parent company - VEC will have a charter capital of 39,366 billion VND.

According to the Government's assessment, the charter capital of the parent company - VEC is very low (VND 1,115 billion) compared to the investment scale (about VND 108,865 billion), so VEC has difficulty mobilizing capital sources to invest in expressway projects, ensuring the completion of the 5-year production and business plan and development investment for the period 2021 - 2025, Development Strategy to 2030, vision to 2035 (investment capital demand for the period 2021-2025 is VND 14,890 billion, the period 2026-2030 is VND 17,053 billion), especially for capital sources with low capital costs such as commercial loans and construction bond issuance.

On the other hand, recognizing the capital contribution of the State owner through the value of assets formed from investment activities, enhancing the effectiveness of State investment capital, creating conditions for VEC to develop sustainably; enhancing financial capacity, ensuring the implementation of commitments to customers and financial partners.

In addition, the additional charter capital also helps VEC improve its access to credit, ensure the basis for depreciation and accounting for expressway assets, and promote its core/leading role in investment/management and operation of expressway operations.

It should be added that VEC is a state-owned enterprise (owned by the state) established in 2004 with the main business lines of investing in construction, management, maintenance and toll collection of national expressways.

By the end of December 2024, this unit had invested in 5 expressway projects (550 km with a total investment of VND 108,865 billion; state budget capital accounted for 44.4%, VEC mobilized capital accounted for 55.6%).

According to the Development Strategy to 2030, vision to 2035; Production and business plan and development investment to 2025 approved by the State Capital Management Committee at enterprises, VEC will balance from equity capital to replace public investment capital to implement the Ben Luc - Long Thanh Expressway Project (7,547.57 billion VND); invest in expanding the Ho Chi Minh City - Long Thanh Expressway section (15,000 billion VND); invest in expanding the Yen Bai - Lao Cai Expressway section (7,000 billion VND).

VEC's estimated total investment for the above projects in the 2021-2025 period is VND 14,890 billion, and in the 2026-2030 period is VND 17,053 billion.

Source: https://baodautu.vn/chinh-phu-chinh-thuc-trinh-quoc-hoi-bo-sung-38251-ty-dong-von-dieu-le-cho-vec-d244129.html