Vietnam Development Bank and DeoCa Group: MOU's Signing ceremony to finance state investment credit capital

02/04/2024 12:04

On March 28, 2024, in Hanoi, Vietnam Development Bank (VDB) and Deo Ca Group Joint Stock Company (Deo Ca Group) have held a signing ceremony of a MOU on financing state investment credit capital to implement transport infrastructure projects according to the public-private partnership (PPP) scheme. Deputy Minister of Transport Le Anh Tuan witnessed the signing ceremony and had speech.

     By the MOU signed by VDB’s Lam Dong branch and Deo Ca Group - investor in the field of transportation infrastructure in the form of PPP, The two parties agreed to use state investment credit capital to finance transport infrastructure projects involving Deo Ca Group as investor. More precisely, such projects must be in the list and eligible to to state investment credit conditions as prescribed by the Decree No. 78/2023/ND-CP dated November 7, 2023 amending and supplementing a number articles of the Government’s Decree No. 32/2017/ND-CP dated March 31, 2017 on state investment credit.
     The MOU is the basis for Lam Dong branch and Deo Ca Group to implement next steps to finance state investment credit to Deo Ca Group’s projects.
     According to the MOU, the total financing amount expected for the period from 2024 - 2027 is about VND 20.000 billion, VND 1.400 billion, VND 3.500 billion, VND 9.600 billion, VND 5.500 billion for 2024, 2025, 2026 and 2027 respectively. The updated financing need will be notified by Deo Ca Group to Lam Dong branch right after its projects approved by competent authorities for principle.
     Currently, for PPP projects, investors have to take credit from commercial banks with high interest rates and short term conditions. Banks are often not keen to these ones as its have low State stake and have usually not yet solved issues during implementation process.
     The cooperation between two parties will resolve some obstacles in implementing PPP projects, make fund mobilization easier, reduce financial burden for investors and contractors while creating confidence for relevant parties, accelerating the project approval and implementation process, and simultaneously, opening up new opportunities for transport infrastructure development, making favorable conditions for the implementation other PPP projects in the future./.

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