1. Country report of Vietnam Of urban transport of Vietnam Mr. Tran Minh Phuong – Ministry of Transport Mr. Nguyen Manh Cuong – Transport development & Strategy Institute. Singapore-Republic of Korea 3rd Country Training Program: Urban Transport Planning & Design 6-16th November 2004

3. The main functions of the Ministry of Transport of Vietnam are as follows: - To formulate and submit national master plan for transport development to the government. - To give instruction to specialized administrations to draft laws and by- laws, policies on transport management - To issue national standards and classify categories of seaports, river ports, road network, railways, inland waterway, and maritime - To submit to the government for approval or to approve works, transport construction projects, technical designs, and implementation methods, check… - To supervise the approval of projects of specialized administrations within authorization of the administrations and manage the quality of transport infrastructure construction works

4. Organization structure: 1. Organization with advisory functions (Planning and investment dept, Legislation and Transport Dept; International Relations Dept; Science and Technology Dept; Finance and Accounting Dept… 2. Specialized management Agencies (Road, Inland Waterway, Maritime, Aviation,… Bureau) 3. Administrative Agencies (Research Institute for Transport Science and Technology (RITST); Transport Development & Strategy Institute (TDSI); University; School for Training Cards, Transport Publishing House … 4. Enterprises (Construction Corporation, Engineering Design Incorporation….)

5. Urban transport Hanoi Capital Pop. 2,9 mill Area: 930km 2 Pop. density: 3120 per km 2 1.53 Km per Km 2 0.49 km road per 1000 pop.

6. Hanoi view

7. HoChiMinh City (CMC) Pop. 5,3 mill Area: 1660km 2 Pop. density: 2520 per km 2 0.79 Km per Km 2 0.31 km road per 1000 pop.

8. Present Characteristic (1) The urban transport system is very bad, in Vietnam, it does meet the rapidly demand in both quantity and quality. Urban transport problems such as traffic congestion and air pollution are becoming importance challenges for the nation’s cities, especially Hanoi and HCMC. Volumes of large goods vehicles and cars are increasing which share a congested road network that is predominated by motorcycles

9. The road network is main infrastructure in urban, but roads are few and narrow (in Hanoi capital: 70% total length is under 11m width; the land used for transport is only 7% of the whole urban land area); Almost crossings are same level; Almost traffic route are mixed without separation of speed; Motorcycle ownership rate is very high, the modal share of motorcycle exceed 75%; There is no mass-rapid transit system in cities; public transportation share (by bus) is under 10% in Hanoi and 3% in HCMC. The average travel speeds in these cities under 20km/hr Air pollution is becoming worse Present Characteristic (2)

10. Traffic jam

11. Public Transportation

12. Traffic accident

13. At a glance in the future (1) There are 64 provinces in Vietnam, which was estimated that 20% of the population lived in urban areas. Of these 8 million people almost 50% lived in big city, such as Hanoi, HCMC. By 2020 urban population set to increase to 45%, this means that 30 million people will be residing in urban areas by 2020. Totally 14 million people live in Hanoi and HCMC in 2020 (Hanoi: 4 million people and HCM 10 million people) with the grown rate 3,5% per year.

14. To formulate a comprehensive master plan for sustainable development To put on public transportation development such as the promotion of bus transport in short term, building the mass transit network (LRT and MRT) in long-term. To upgrade and to construct new road (including the ring road), difference level crossing, and flyovers. To propose measure to strengthen the institutional capacity of concerned governmental organizations. Freeing up the public transport services from congestion would make the operation more efficient and make the existing vehicle fleets able to carry more passengers in the same time period At a glance in the future (2)

15. Cities must have a balance of services to meet the demand for trade and commerce, education and recreation. Their needs to be a balance in traffic flows and to achieve this there has to be a strong emphasis on land use planning. Make better for air condition: Air pollution from motor vehicles, most pollution is caused by diesel and petrol driven motor vehicles. To find out the capital for all of these works: Cities authorizer to issue bonds to finance infrastructure; Private sector will be encouraged to make BOT investments. At a glance in the future (3)

16. Hanoi in 2020

17. Investment plan for Hanoi Component Estimated Costs 2001-20102011-2020 Road Ring road No,176.2x Ring road No.284.9x Ring road No.3180x Ring road No.4 x Ring road No.5 x Other main road 150.9 x x Resettlement area development 295.5 x x Railway 8 routes x x

18. HCMC in 2020

19. Investment plan Component Costs 2004-20102011-2020 Road Primary Road3,361xx Secondary Road2,656xx Urban Expressway1,861 x Sub - Total7,878 UMRT Line 1 (66km, Urban Rail+Busway)1,082xx Line 2 (33km, Urban Rail+Busway)684 x Line 3 (20km, Urban Rail)612 x Line 4 (19km, Urban Rail)660 x Sub - Total3,038 Other Projects Flyovers1,401xx Transport Terminals200xx Bus corridor Management50x Bus System Modernization222x Local Traffic Improvement300x CBD Traffic Management100 x Pedestrian/Green Network Development20x Traffic Safety Improvement20xx Air Quality Improvement20xx Urban Waterway Transport10xx Traffic Management Capacity Improvement10x Sub - Total2,3534,2998,955

20. Proposed policy Instruments for bus Operators ItemProposal by TUPWS, HanoiProposal by TUPWS, HCMC Vehicle purchasing Establishing a bus lease hold entity to reduce financial burden of the operators Allowing vehicle supplier for monopolistic business, if it provided payment in installment of 7 to 10 years at the interest rate of 5-7% Buying domestic vehicles (Hoa Binh Motor, Hanoi Motor, etc) at less expensive prices Soft loans for purchasing bus vehicle Domestic soft loansLoan from the State budget for capital investment with interest rate of 0% Grand aid and export/import credits guarantied by the Government. Japanese ODA loan with interest rate of 0.75% Japanese ODA Infrastructure development by the Government Allocation of the State budget for construction of depots, bus stops and parking space Governmental capital investment for terminals, shelter, bus stop, operation stations (Cho Lon, Gia Dinh), garages and depots (23,000m 2 ) Affordable Fare Level 1,000-1,500 VND/tripReduce by 50% of the current rates to 1,000 VND/trip (less than 15km) and over 2,000 VND/trip (over 15km) 30,000 VND/month

21. Subsidy Subsidy in accordance with the volume of passenger- kilometers with a ratio not more than 45% of the total approved cost Procedures for enjoying tax exemption should be simple: Once the contract on bus operation is signed with MOCPT, tho operators do not need to submit their application to MOT and MOF. The People's Committee of HCMC should be the final authority for this task Source of subsidy is surcharges for motorcycle of 100,000 VNDp.a and car of 2,500,000 VND p.a Tax exemption 100% import tax exemption Business tax exemptionDuration of the current tax exemption should be expensed from one year to 8-10 years Land use tax exemption for deports, workshop etc12 seat vehicles should be included into the tax exemption scheme (Buses of over 15 seats are beneficiaries of the current scheme) Capital use tax exemption for the state-owned enterprises. Revenue tax and profit tax should be exempted at 100% 100% revenue tax exemptionLicense tax should be paid by each enterprise, not be each vehicle base. Profit tax exemption Levy exemption 50% reduction of registration fees, and 10% exemption of bridge and road tolls and parking fees 100% exemption of bridge and road tolls, packing charges in interprovincial depots. (Official Letter No.5392/UBQLDT of HCMC, 15th December 1997) Transportation fee (levied on petrol consumption) exemption: Financial body should refund the amount of transportation fee in accordance with the volume of fuel used Bus depot use fee exemption Bridge toll exemption Remove other competitor Other Remove/prohibit other public transport means (tuk tuk and cycle) in the urban area Allowing transportation companies to undertake other business activities to reduce the amount of subsidy Establishment of "Development Fund for Public transportation"

22. Referent document Urban infrastructure development project in Hanoi (OECR, 1998) Urban public Transportation in Vietnam Houtrans project (HCMC urban transportation project) …..

23. Conclusion Urban transport system is to play a significant role in the life of a city but much needs to be done in the urban transport in Vietnam. I hope that after this training course I can use all the good experience in situation, potentiality and development orientations for Vietnam Urban Transport sector in the coming decades. Thank you for your attention!