Investors Bullish As Vietnam Pumps US$5 Billion into Infrastructure

SINGAPORE, Jan. 26, 2012 /PRNewswire-Asia/ -- In Vietnam, the road to economic growth seems to be paved with asphalt. By 2020, the Vietnamese Ministry of Transport is expected to pump slightly over US$5 billion into the country's road transport infrastructure.

So why is Vietnam spending the equivalent of Liechtenstein's GDP on developing its roads?

Since Y2K, the number of people travelling by road in the country has almost tripled from 620 million passengers to a staggering 1.76 billion passengers. But that's not the only reason; freight traffic by road has also tripled from 7969.9 million tonnes per kilometer to 31587.2 million tonnes per kilometer, a surge of nearly 400%.

This significant increase can be put down to the proliferation of automobile ownership. By November 2011, nearly 100,000 vehicles were sold in Vietnam, down only 1% over the same period last year, with cars and multipurpose vehicles sales increasing 23.9% and 4% respectively.

-- Vietnamese Vehicle sales till November 2011

Vehicle Type North China Nam Total

Cars 1,727 1.727 308 308 1,155 1.155 3,190 3.190

Vehicle

cross-over - - - - - - - -

Multipurpose

vehicle MPV 237 237 65 65 329 329 631 631

Multipurpose

vehicle SUV 505 505 109 109 453 453 1,067 1.067

Minibus Truck,

Bus 141 141 49 49 189 189 379 379

Truck, Pick-up

& Van 1,195 1.195 468 468 1,577 1.577 3,240 3.240

Xe khac

Another

vehicle - - 1:00 AM 2 2 3 3

Total 3,805 3.805 1,000 1.000 3,705 3.705 8,773 (1) 8,773 (1)

Bus Chassis 5 5 - - 24 24 29 29

Source: Vietnam Automobile Manufacturers' Association

With regards to foreign investment, Lieven Jacquemyn, Managing Director of Plektics, believes that on a macro level, Vietnam has painted a very promising picture over the last decade.

"Strong fundamentals supporting foreign investment interest are the stable political system, political support and a consistent rapid economic growth. During the 2008 Financial Crisis and its aftermath, Vietnam's Real Estate and Stock Market have suffered; however, in hindsight it probably triggered an overdue correction bringing things back to reality and perspective," he said.

"Many foreign investors still regard Vietnam as a prime investment destination but are at the same time expecting the government to further develop and enhance its infrastructure to support and advance economic growth; especially in the areas of transportation and energy," added Jacquemyn.

Having worked closely with Vietnam's Ministry of Transportation (MOT), IQPC is proud to announce Transport Infrastructure Vietnam 2012( http://www.transportinfrastructure-vietnam.com/Event.aspx?id=661598&MAC=PR ). Find out more at www.transportinfrastructure-vietnam.com( http://www.transportinfrastructure-vietnam.com/Event.aspx?id=661598&MAC=PR ).

SOURCE　IQPC Worldwide