Vietnam to raise $10bn to build its largest airport

HANOI: The Vietnamese government plans to issue bonds, tap official development assistance funding and seek private funds to raise $10 billion to build the country's biggest airport over the next decade, a state-run newspaper reported on Saturday.

The infrastructure of the Long Thanh airport in the southern province of Dong Nai will be built by funds provided by the government and from the official development assistance while private funding -- including foreign and domestic loans -- would be used to construct the passenger terminal, the Vietnam News daily said.

Construction would be in three phases, starting in 2015, and the airport, 43 km (27 miles) northeast of Ho Chi Minh City, would handle 25 million passengers a year by 2020, more than double the capacity of the city's current Tan Son Nhat airport.

By 2035 it would serve 100 million passengers a year, said the daily run by the official Vietnam News Agency, after Transport Minister Dinh La Thang released the airport's development plan on Friday in Dong Nai province.

More than $6.7 billion is needed for site clearance and first-phase construction, the daily cited the plan as saying.

It gave no further details of funding sources.

Vietnam's net foreign debt is forecast to rise to $18.8 billion in 2012, or 13.6 percent of its gross domestic product, from $17.3 billion this year before easing to $16 billion in 2013, Fitch Ratings said in its latest report for Vietnam this week.

It re-affirmed Vietnam's long-term foreign-currency rating at 'B+' with stable outlook, placing the country in peer group with another nine countries, including Mongolia, Bolivia, Venezuela, Ghana and Zambia.

Copyright Reuters, 2011