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State-owned banks to provide US$1.8-billion loan for Long Thanh Airport project
Ngoc Mai 20:34, 2024/06/01
Once completed, the Long Thanh Airport is expected to help Vietnam become a leading hub for air transport and logistics in Southeast Asia and the world.

Major state-owned banks, namely Vietcombank, Vietinbank, and BIDV today [June 1] signed a US$1.8 billion loan agreement with the Airports Corporation of Vietnam (ACV) for the Long Thanh Airport project.

 Overview of the signing ceremony. Photos: Nhat Bac

The fund would be used for Component 3 - Essential Facilities of the Long Thanh International Airport Construction Investment Project - Phase 1, with ACV as the investor.

Speaking at the ceremony, Prime Minister Pham Minh Chinh emphasized that the Government has identified infrastructure development as one of the three strategic breakthroughs necessary for the modernization and advancement of the country. The focus is on developing a synchronized and modern infrastructure system, particularly in the transport sector (including highways and airports), which serves as a crucial pillar for creating new development spaces, driving socio-economic growth, and ensuring national defense and security.

Historically, transportation infrastructure, especially highways, airports, and seaports, has played a pioneering and leading role in socio-economic development. Improved transportation opens up new spaces for development, creating fresh momentum, potential, value, and impetus.

The Prime Minister asserted that the Long Thanh International Airport Construction Project is a national priority and a key project for the transportation sector.

“It is a special-class project of strategic importance for the socio-economic development of the Southern Key Economic Region and the aviation sector, as well as for the entire country's socio-economic growth in the coming years,” he said.

Approved by the National Assembly in 2015, the project aims to develop Long Thanh Airport into a key national international airport. Spanning over 5,000 hectares, it will be the largest in Vietnam, with a capacity to handle 100 million passengers and 5 million tons of cargo annually, utilizing advanced and modern management and operational technologies.

Together with the expanded Tan Son Nhat International Airport, Long Thanh International Airport will form a modern airport complex with substantial capacity and efficient, high-quality operations. It aims to become a leading aviation and logistics hub in the region and internationally.

 Prime Minister Pham Minh Chinh addresses the event. 

“The $1.8 billion loan represents a significant breakthrough for domestic commercial banks in arranging foreign currency financing for clients. This project is notable for being the largest foreign currency-funded project by Vietnamese commercial banks, particularly state-owned banks, and the first to be fully financed with medium and long-term USD loans from domestic commercial banks at competitive conditions compared to direct loans from international financial institutions,” Chinh said.

In addition to promoting safe and sustainable credit growth, the $1.8 billion financing of a major project such as Long Thanh International Airport showcases the strength and capacity of Vietnamese commercial banks in arranging financing for complex and large-scale projects. He continued that it sets a positive precedent, encouraging domestic investors to be proactive and less reliant on foreign loans in the future.

The Prime Minister urged state-owned commercial banks and the banking sector to continue exploring and participating in the financing of other significant national projects, encouraging domestic investors to enhance their autonomy and inherent capabilities in investment and development cooperation.

 The design of the Long Thanh Airport. 

The SBV will facilitate credit institutions in providing foreign exchange services per the law while monitoring foreign exchange activities to stabilize the currency value, and exchange rates, and improve the balance of payments. This will contribute to macroeconomic stability and socio-economic development.

For his part, the Chairman of the Board of ACV Lai Xuan Thanh said the airport operator is committed to using the investment funds for Phase 1 - Component 3 of the Long Thanh International Airport Project efficiently, in strict compliance with the law, and with measures to prevent waste, corruption, and malpractice.

“These efforts will contribute significantly to the nation's economic recovery and development, and maintain ACV's leading role in managing and developing the national aviation infrastructure,” said Thanh.

The Long Thanh International Airport Construction Investment Project Phase 1 is a critically important national project with significant implications for Vietnam's socio-economic development. The project includes a runway and one passenger terminal, along with supporting facilities, designed to handle 25 million passengers and 1.2 million tons of cargo per year.  

Upon completion of all phases, Long Thanh International Airport is expected to reach a capacity of up to 100 million passengers per year, making it the largest airport in Vietnam and positioning it as a major international aviation hub in the region.

By 2030, the airport is projected to contribute approximately 0.98% of  Vietnam's GDP, create 200,000 jobs, and have a wide socio-economic impact.

TAG: long thanh airport BIDV Vietinbank Vietcombank aviation Vietnam
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