Hanoi (VNA) - The Ministry ofTransport plans to speed up the implementation of the North-South expresswayproject in 2019, said Minister of Transport Nguyen Van The.

He said the ministry had approved a feasibilitystudy of 11 sub-projects of the North-South expressway project since Octoberlast year and is in the process of selecting consultation firms.

The ministry will manage to disburse half of 14trillion VND (601 million USD) raised from bond issuance this year for landclearance work and finish acquisition of all required lands by next year, Thesaid.

The Ministry ofTransport (MoT) had opened bidding for the Cao Bo-Mai Son and Cam Lo-Son Lastretches. The contractors would be chosen in the second quarter of this year.Work on the two sections would begin soon so the projects would be completed in2021.

The selection ofcontractors for My Thuan 2 Bridge project would finish in October this year andthe project would be completed in 2022.

The ministry would begin the bidding processfrom the private sector in September and October, The said.

The MoT wants to finish the selection ofinvestors this year so that work can begin next year and in 2021, hesaid, adding that information on the bidding process would be updatedregularly.

Investment in the project for the period2017-2020 was approved by the National Assembly. The total cost ofeleven sub-projects of the North-South expressway project with the length of654 kilometres is 118 trillion VND (5.06 billion USD).

Three will be financedby the State and eight will be implemented through public-private partnerships(PPP). However, challengesremain attracting investors, experts said.

The ministry has said it took the regulated loaninterest rate of 7.72 percent as a basic rate for the feasibility study andsetting bidding dossiers. But in reality, the loan interest rate in the marketstood at 10.5-11 percent per year.

In a report to the National Assembly lastOctober, The admitted this was creating difficulties for investors. If the Ministry of Finance could amendregulations and increase the ceiling to 10.5 percent, it would help attractinvestment.

According to Nguyen Quang Toan, former dean ofRoad Faculty of the University of Transport and Communications, the Ministry ofTransport cannot use the interest rate of 7.7 percent per year to set up afeasibility study for the project, but it must be made relevant to reality andthe market interest rate.

If the loan interest rate for the PPP projectsremains unchanged, the Government must adjust the policy to attract investor, he said.

For example, banks lends BOT projects with theinterest rate of 7.7 percent but if they suffer losses, the State shouldcompensate them basing on the real interest rate, Toan added.-VNA