Tuesday, October 25 2016


Road toll hike delayed to June 1

Update: January, 07/2016 - 10:23

Nguyen Hong Truong, Deputy Minister of Transport, spoke to the newspaper Thoi bao Kinh te Viet Nam (Viet Nam Economic Times) about the challenges of delaying the increase in road tolls to June 1.

Will you please explain why the Ministry of Transport sent an official letter of request to the Ministry of Finance and BOT investors asking them to postpone the price hike of toll roads until June 1, five months later than the date that was originally chosen?

With instruction from the Ministry of Transport (MOT), BOT investors were advised to set their tolls based on two key factors: the national economy's growth rate and the payment ability of the people and enterprises.

Since 2002, every two to five years, whenever the CPI increases, road tolls are adjusted. In all BOT project documents, every three years, the owners come up with proposals to adjust their road fees. So as of 2002, the road fees were subjected to increases twice. At the beginning, the toll was VND10,000 for automobiles with fewer than 10 seats. Then it was raised to VND 20,000, and now it is VND30,000.

The growth rate of our national economy in the past several years has been rather stable, while petrol prices have been reduced. That has also been the case for transportation fees. Now, if the road fee increases, it will impose a virtual pressure on people. However, in reality, it is the right time to increase the tolls.

In a reply letter from the Ministry of Transport, the Ministry of Finance said at present there are 23 BOT toll stations nationwide. If the decision to increase the tolls is delayed until June 1, the MOT must issue 23 Circulars to annul the previous decision to impose a new toll on January 1. Furthermore, the MOF only received the letter of request from the MOT on December 25 – seven days before the toll increase decision was to take effect. That's why the MOF could not grant the MOT proposal to delay the toll increase until June 1. In addition, all BOT toll stations have sold their monthly and quarterly tickets to motorists.

Last but not least, a delay would affect the financial schemes of all BOT investors, as most of their bank debts are already matured and they have to pay their debts.

Will you please explain why the tolls vary from one station to another?

I would say there is nothing dubious about the price of the tolls in the 23 BOT road toll stations. BOT investors have discussed and agreed to impose the same fees nationwide in the near future.

For example, the Ben Thuy station has four BOT projects, including the Vinh City diversion, Ha Tinh City diversion, a bridge crossing the National Road 46 and the Nghi Xuan bridge. At present, each BOT project has erected its own toll stations to charge motorists.

The MOT is currently discussing with BOT investors and local authorities to set rational tolls for motorists. In the end, the tolls must be reasonable and acceptable to road users.

However, I just want to emphasise the necessity of increasing the tolls of all BOT projects. But in regards to how much the tolls will increase, the investors must consider it carefully before making their final decisions.

According to the MOF, if the new tolls are delayed until June 1, the ministry would have to issue a separate circular for each BOT toll station. Is this the biggest hurdle in postponing it six months before introducing the new tolls in BOT projects?

Legally speaking – regardless if it's the issuance of 20 or a hundred circulars – if it must be done, it can be done. However, the change must conform to reality and balance capital payback from the investors and the ability to pay the tolls of road users, as well as the growth of the national economy.

If, for instance, a toll station is placed on one road, but the collected money is used for another road, will the government buy these toll stations?

Yes, that policy is in the pipeline. But when it will be applied depends on the national economic development level. This formula has already been done in some other countries. When the government is strong financially, it will buy the BOT toll stations. However, procedures of buying these BOT toll stations will be divided into different phases. — VNS

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