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ADB and Viet Nam Signed Technical Assistance to Prepare Two MRT Lines in Ho Chi Minh City

HANOI, VIET NAM (3 May 2007) – An agreement for US$1.7 million technical assistance (TA) grant from ADB was signed today in Hanoi to help prepare a project that will develop two urban mass rapid transit (MRT) rail lines in Ho Chi Minh City, Viet Nam.

The grant is from ADB's Japan Special Fund, funded by the Government of Japan, and the agreement was signed by Deputy Governor Phung Khac Ke of the State Bank of Viet Nam, representative of the People's Committee of Ho Chi Minh City, and ADB Country Director for Viet Nam, Ayumi Konishi, in the presence of representative of the Embassy of Japan in Viet Nam.

Ho Chi Minh City, the largest city in Viet Nam and the country's economic hub, has a population forecast to swell from the current 7.9 million to 13.5 million by 2020. Private vehicles in the city now account for more than 90% of total journeys (most of which are motorcycles), and rising incomes are allowing more households to afford cars.

"Traffic situation in Ho Chi Minh City is already approaching the critical level, and unless the City develops better transport infrastructure and public transport systems urgently, it will suffer from serious issues of traffic jam, road security, and air pollution similar to those in other large Asian cities as the City grows further," said Ayumi Konishi.

"MRTs can provide convenient, comfortable, safe, affordable, and clean urban travel, thus reducing reliance on private modes of travel and improving the quality of urban living for Ho Chi Minh City residents."

Between now and 2020, the City plans to develop six MRT lines with the possible total budget of over $5 billion, and the TA will make preparations for two of these six lines. The City's People's Committee aims to raise the share of public transport to carry one quarter of all daily motorized trips by 2010 and 50% by 2020, a sharp increase from mid 2005 levels which were as low as 2%.

The two lines, projected to cover a total of 20.6 kilometers, with 22 stations, will traverse Ho Chi Minh City's central business district.

ADB's TA grant will finance the preparation of a consolidated MRT network master plan and land use strategy that maximizes MRT use and reflects anticipated demand.

The TA will also help draw up preliminary engineering designs and technical and operational standards, with supporting social, environmental, technical, economic and financial appraisals. Financing options, such as public-private partnerships, will likewise be proposed.

ADB is coordinating with the Japan Bank for International Cooperation (JBIC) which is supporting another 19 kilometer line, to implement a wider intermodal and integrated urban transport system in Ho Chi Minh City, and to codesign the main central station at Ben Thanh market.

The Government will contribute $500,000 equivalent toward the TA's estimated total cost of $2.2 million. The Urban Metro Preparation Unit of the Ho Chi Minh City is the executing agency for the TA, which is due for completion around April 2008.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 67 members - 48 from the region. In 2006, it approved loans and grants for projects totaling $8.5 billion, and technical assistance amounting to almost $242 million.

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