Hanoi (VNA) - In a bid to resolveobstacles to implement the national electronic toll collection (ETC) project,the Government has allowed the Ministry of Transport (MoT) to decide how muchrevenue to extract from BOT projects to pay for ETC service.

Under a document signed recently by Deputy PrimeMinister Trinh Dinh Dung, the MoT is authorised to direct relevant agenciescollaborating with investors in Build-Operate-Transfer (BOT) andBuild-Own-Operate (BOO) projects in determining the cost and revenue of BOT andBOO projects. This move aims to provide benefits to BOT and ETC investors whileensuring road users don’t have to pay higher fees.

The Deputy Prime Minister also requestedpeople’s committees of provinces and cities choose toll collection serviceproviders in accordance with their authority and State regulations on biddingso that the goal of installing ETC at all BOT toll booths by the end of 2019can be realised.

At a meeting held last week to review theprogress of key transport projects, Minister of Transport Nguyen Van The askedthe Directorate for Roads of Vietnam (DRVN) to work with BOT and ETC investorsto speed up installation of the ETC system.

“There is not much time left so we must hastenthe project’s progress. Priority should be given to stations at the entrance tocity centres, especially expressways. The ETC system should be installed at allroutes of the Vietnam Expressway Corporation (VEC),” he told governmentportal chinhphu.vn.

Over the past few months, the ETC installationhas been delayed due to some difficulties, making investors hesitant, The said.

To solve the issue, the MoT has submitted theproposal to the Government and received approval.

With the new authorisation from the Government,all projects will be deployed quickly and banks can continue providing loansfor equipment installations, he said, adding that the rapid application of theETC system nationwide would help boost transparency in toll collection.

Prime Minister Nguyen Xuan Phuc has requestedthat road toll collection be automated at all tollbooths on National Highway No1 and the Ho Chi Minh Trail, which passes through Central Highlands region, bythe end of this year. However, just 24 stations out of 28 have been equippedwith the systems by August, according to DRVN, raising fears that the targetmay be missed.

ETC system provider VETC does not yet havesufficient equity under the BOO investment format. As stated in a contract withthe MoT, VETC must prove it has 277 billion VND (11.8 million USD) in equitybut the company has so far mobilised 129 billion VND, less than a half of therequired funding. If the company fails to meet the requirement, the ministrycould terminate the contract.

According to Nguyen Manh Ha, VETC General Director,the revenue shortfall is the biggest obstacle. It was also the main reasonexplaining why the company could not offset its costs as planned.

Specifically, under BOO deals, VETC enjoysbenefits through ETC service it offers to BOT investors. The revenue ofthe service in the 2016-18 period should be equal to all the organisational andmanagement costs that will be incurred in the absence of ETC systems.

However, instead of transferring all suchrevenue to VETC, BOT investors wanted to retain half of those funds to ensurethat the system will work smoothly in the toll collection process.

As a result, the VETC is now facing financialimbalance. It is estimated that each month the company loses about 11.6 billionVND, raising an accumulated 123.7 billion VND within two years of executing theproject.-VNS/VNA