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Loan Amount and Terms

Project NameAmount
(Mil. Yen)
Interest Rate
(% / year) ***
/Grace Period (years)
Terms of Procurement
Transport Sector Loan for National Road Network Improvement (II)17,9181.2
General, untied
Hanoi City Urban Railway Construction Project: Nam Thang Long – Tran Hung Dao Section (Line 2) (I) *14,6880.2
40/10Japan, tied
Hai Phong City Environmental Improvement Project (II) **21,3060.55
40/10General, untied
Second Hanoi Drainage Project for Environmental Improvement (II) **29,2890.55
40/10General, untied
Total83,2010.0115/5General untied

* Japan’s Special Terms for Economic Partnership apply for the financing of advanced Japanese technology and expertise transfers for urban rail improvement.
** Efforts to solve environmental problems in developing countries are being actively supported by applying a lower than normal interest rate to projects with an environmental focus.
*** Applies to consulting services.

(1) Transport Sector Loan for National Road Network Improvement (II)

Background and Necessity
Vietnam’s extensive road network covers 220 thousand kilometers of national highways and interconnected provincial, regional and rural village roads. This also includes 17 hundred kilometers of national highway that serve as arteries for the country’s main cities. The national highways and provincial roads are served by some 225 kilometers of bridges, nearly eight thousand all told. They currently pose a significant safety hazard due to wartime damage and poor maintenance stemming from repair budget constraints.

If Vietnam is to successfully handle future traffic increases and ensure safe travel, it must repair and replace these aging bridges to form a more efficient national road network. However, as the demand for road and bridge maintenance rises, Vietnam will need to set budget allowances for maintenance and to efficiently allocate their limited financial means. This means that the entire bridge maintenance system urgently needs to be overhauled – including long-term maintenance planning, maintenance database updates, revision of bridge inspection manuals and staff development – and a comprehensive long-term maintenance plan must be formulated.

Objective and Summary
Vietnam’s bridges and roadways are crucial to the economic well-being of the entire country. Phase II of the National Highway and Provincial Road and Bridge Repair Project will support bridge repairs and replacement as well as enhancements to bridge and road maintenance capacity. This will ensure a smooth-running, safe national road network for improved transportation capacity, in turn contributing to socioeconomic development in the urban and rural sectors.

Loan funds will be allocated for the civil engineering work, equipment and materials needed to repair and replace high-priority bridges connecting the country’s national highways and provincial roads. Funds will also go to consulting services to develop a more efficient bridge maintenance system.

Candidate bridges will be selected based on economic value. Factors such as traffic volume and road importance, as well as the impact on regional economic development will be considered. Priority will be determined by technical requirements and urgency including load limits, road width and construction date.

In the meantime, JICA grant aid is being used to repair small-scale bridges in rural and minority-inhabited regions as a measure to combat poverty and encourage regional revitalization.

Executing agency: Vietnam Road Administration (VRA) of the Ministry of Transport
Address: 106 Thai Thinh Str. Dong Da District, Hanoi, Vietnam
Phone: +84 (4) 857-1542, Fax: +84 (4) 857-1440

(2) Hanoi City Urban Railway Construction Project (Nam Thang Long – Tran Hung Dao Section (Line 2)) (I)

Background and Necessity
The Vietnamese capital of Hanoi spans 925 square kilometers and has a population of about 3.2 million. In addition to its administrative function, Hanoi serves an important role as the central city in Vietnam’s northern key economic region, making it critical to ensure the enhanced capabilities required of any internationally competitive city. However, increased population, coupled with economic growth and the popularity of inexpensive motorcycles, has rapidly increased the amount of road traffic, resulting in congestion and unsafe travel. Whereas Hanoi posted average traffic speeds of 26.0 kilometers per hour in 2005, this rate is predicted to drop to 9.4 by 2020 if present trends continue. Air pollution poses another problem. Hanoi’s concentration of total suspended particulates is reaching numbers that greatly exceed the environmental standard of 0.2 milligrams per cubic meter, and according to the fourth report in the Global Environment Outlook presented by the United Nations Environment Programme in October 2007, Hanoi is ranked among the six highest cities in the world for air pollution.

This situation is beyond the capabilities of existing public bus and rail services, as well as the existing road network, and therefore a new large-scale urban transportation system is required.

Objective and Summary
Under the second phase of the Hanoi City Urban Railway Construction Project, 12 kilometers of subways and elevated urban rail will be built in Hanoi, extending from Nam Thang Long in the west to Tran Hung Dao in Hanoi’s center. This will accommodate the city’s increasing transportation demands, and further alleviate traffic congestion and air pollution. Regional economic development and the investment environment are also expected to benefit.

For the project, Japan’s Special Terms for Economic Partnership will be applied to ensure that the new rail services are on-time, capable of handling high-volume transportation and can guarantee safety. Japanese railway technology and expertise will be employed including its energy-efficient light rail vehicles and low maintenance costs.

Additionally, the Asian Development Bank is coordinating with JICA to provide the technical cooperation needed to formulate engineering standards for urban rail, and is also studying how to use such JICA technical cooperation to reinforce support for operations and maintenance.

Loan funds will be allocated to perform the civil engineering work needed for rail construction, in addition to purchasing vehicles, equipment and other materials. Funds will also be used to provide the necessary consulting services.

Executing agency: Hanoi Metropolitan Rail Transport Project Board
Address: 8 Ho Xuan Huong, Hanoi, Vietnam
Phone: +84 (8) 943-5127, Fax: +84 (4) 943-5126

(3) Hai Phong City Environmental Improvement Project (II)

Background and Necessity
Hai Phong is a city located 100 kilometers east of Hanoi along the northern coast of Vietnam. The third largest city in the country, spanning an area of 15 hundred square kilometers with a population of about 1.8 million, it is currently being developed into an international port city. Unfortunately, its sewage treatment plants have not been upgraded despite a marked increase in domestic and industrial wastewater from rapid industrialization and urbanization in recent years, resulting in untreated city sewage being discharged into rivers. This has lead to pollution of the Cam River flowing through Hai Phong, making it one of the most polluted rivers in all of Vietnam.

Hai Phong is also vulnerable to flooding due its proximity to the mouth of the Red River Delta, and is often subject to torrential rains from May to September caused by the many typhoons that visit each year. Despite these continual threats, the city’s rainwater drainage facilities are ill-equipped to handle the conditions, resulting in flood damage about every other year. The renovation and improvement of drainage systems is therefore an important priority.

In addition, Hai Phong’s improved living standards and dense rising concentration have led to an increase in waste that cannot be properly handled by the city’s aging waste collection equipment, resulting in worsening sanitary conditions in the city. Although collected waste is disposed at three existing landfills, they are not equipped with proper treatment facilities, causing pollution in the forms of stench and filthy water. It is also predicted that the amount of landfill at the current sites will soon exceed the originally intended capacity.

Objective and Summary
The second phase of the Hai Phong City Environmental Improvement Project will oversee the upgrade of treatment systems for sewage, drainage and waste, including Hai Phong’s first sewage treatment plant. By improving water quality, preventing flooding and properly treating waste, the living environment and sanitation will be improved.

Loan funds will be allocated to upgrade sewage, drainage and waste treatment systems as well as for resident relocation infrastructures. Funds will additionally be provided for consulting services to support the formulation of a suitable plan for sewer service fees, while landfill disposal and improved waste management is being studied in cooperation with Fukuoka and other Japanese municipalities.

Executing agency: Hai Phong People’s Committee
Address: 18 Hoang Dieu Street, Hai Phong, Vietnam
Phone: +84 0803-1254, Fax: +84 (31) 842-368

(4) Second Hanoi Drainage Project for Environmental Improvement, (II)

Background and Necessity
The Vietnamese capital of Hanoi, spanning 925 square kilometers and with a population of about 3.2 million, has seen a marked increase in domestic and industrial wastewater in recent years as a result of rapid industrialization and urbanization. Unfortunately, maintenance of the city’s sewage treatment plants has been inadequate, resulting in untreated city sewage often being discharged into rivers, causing severe pollution in canals and inland waters.

The problem is particularly urgent due to frequent flooding at the lowlands of the Red River flowing through Hanoi, the largest river in all Vietnam, especially between May and September when typhoons arrive.

Objective and Summary
Under the second phase of the Second Hanoi Drainage Project for Environmental Improvement, Hanoi’s drainage and sewage systems will be renovated to improve the city’s water quality and prevent flooding, thereby improving the living environment and sanitation. The project has already received support during its first phase in the form of two Japanese ODA loans: the first for 6.41 billion yen from a loan agreement signed in April 1995 and a second for 12.17 billion from an agreement signed in March 1998. The second phase has so far received a loan amounting to 3.04 billion yen from an agreement signed in March 2006, with the present Japanese ODA loan to finance the second stage of this phase.

Loan funds will be allocated for civil engineering work and equipment purchases. Funds will also be used for consulting services to support the drafting of a feasibility study to examine the construction of a new large-scale sewage treatment plant, taking into account demands from adjacent regions for a reduction in the amount of pollutants released by Hanoi.

Executing agency: Department of Construction, Hanoi People’s Committee
Address: 52 Le Dai Hanh, Hanoi, Vietnam
Phone: +84 (4) 976-2194, Fax: +84 (4) 976-1295


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