Study on Economic Partnership Projects. in Developing Countries in FY2010. Study on Phuoc An Bridge Construction Project

Transcription

1 Study on Economic Partnership Projects in Developing Countries in FY2010 Study on Phuoc An Bridge Construction Project on Cai Mep Thi Vai Inter-Port Road in the Socialist Republic of Vietnam SUMMARY March 2011 第 1 章 第 2 章 The Ministry of Economy, Trade and Industry Prepared by: Ernst & Young ShinNihon LLC Japan External Trade Organization (JETRO) Chodai CO., LTD. NIPPON KOEI CO., LTD. KAJIMA CORPORATION

2 1. Background and Necessity of the Project 1.1 Background of the Project The Socialist Republic of Viet Nam (hereinafter referred to as Vietnam ) enacted the Doi Moi (Renovation) Policy in 1986 and began obtaining its effects around After that, economic growth in Vietnam continued as high as 9% for the years of 1995 and In 1997, however, tendencies such as slow-down of the growth rate decreased under the impact of the Asian economic crisis, thereby decreasing the growth rate to 4.8% in After that, the growth rate gradually recovered and the rate of 5.3%, which was the second highest rate in the ASEAN region, was achieved through The Government set an economic growth goal to 6.5% for the fiscal year of Vietnam has a coastline of approximately 3,260km facing the South China Sea and there are more than 150 ports along the coastline, of which 6 ports, Northern, Central North, Central, Central South, Ho Chi Minh City and Mekong, are designated as the most important port areas. Hai Phong International Port (Northern), Van Phong International Port (Central South) and Cai Mep-Thi Vai International Port (Ho Chi Minh City) are designated as strategically important ports (international gateways). There are a number of port facilities in the environs of Ho Chi Minh City, but a plan to remove their functions to the Cai Mep-Thi Vai International Port is in progress due to the many problems such as traffic congestion in Ho Chi Minh City (running of large vehicles is permitted only at nighttime), aged facilities, and poor dredging of navigational channels. It is expected that the future cargo handling volume can be secured and the above problems can be solved by collecting the port facilities at the Cai Mep-Thi Vai Port where the water is deep. This project is planned at the end of the Cai Mep Thi Vai Inter-port Road (Refer to Figure S1). Figure S1 Project Location km

3 1.2 Necessity of the Project This project is located at north-end of the Cai Mep Thi Vai Inter-port Road, along which various developments are ongoing at Cai Mep Thi Vai International Port. When this project is completed, the road is a shortcut to nearby industrial parks and Ho Chi Minh City. Therefore, the Project is expected to contribute considerably to the business activity of the port facilities. Photo-S1 shows an aerial view of the northern part of the international port and the location of Phuoc An Bridge. This photo was taken several years ago. At the present time, however, numerous port facilities and factories are under construction everywhere in the area as shown in Photos S2 and S3. Photo S1 Northern Part of Cai Mep Thi Vai International Port and Location of Phuoc An Bridge Phuoc An Bridge Phuoc An Port My Xuan Port Gas facility Petro Vietnam Facility Thi Vai River Thi Vai Port Inter-port Road Photo S2 Construction of Cai Mep Thi Vai International Port (1)

4 Photo S3 Construction of Cai Mep Thi Vai International Port (2) The Phuoc An bridge of this project is a part of the Cai Mep- Thi Vai Inter-port road, and it is located on the east side of Cai Mep- Thi Vai international port. The Phuoc An bridge is located on the north side of the Cai Mep- Thi Vai Inter-port road, goes across the Thi Vai river, and is connected with the road to a Phuoc An industrial port that is the opposite bank. The road to a Phuoc An industrial port is connected with the Ben Luc- Long Thanh expressway on the north side further. The south of the Thi Vai river is Ba Ria-Vung Tau Province, and the north side is Dong Nai Province. The Phuoc An bridge is located in the province border. The section to connected interchange on the road to a Phuoc An industrial port is in charge of the Ba Ria-Vung Tau Province. According to the construction schedule of the two provinces, road construction to a Phuoc An industrial port of the Dong Nai Province aims at the completion in 2013 and the Phuoc An bridge construction of the Ba Ria-Vung Tau Province aims at completion in Both routes assume it is very important in the economic development strategy and are placed by the most important project of the two provinces. The scope of the Project is shown in Figure S2. Figure S2 Scope of the Project N Km m Km

5 2. Basic Policy for Implementation of the Project 2.1 Basic Policy of Vietnam for Implementation of the Project Outline of Cai Mep Thi Vai Inter Port Road (Ba Ria Vung Tau Province) The large-scale port construction is actively ongoing in Cai Mep- Thi Vai international port now. However, there is no road that passes this area while the port construction is large-scale now. As for the BVDOT (Ba Ria Vung Tau Province Department of Transportation), it is admitted that road works are late compared with the ports construction, and is hoped for the completion at the early stage of this route. The route divides into nine components and component No.2 in that is under construction by ODA. The object of this project is component No.9. There is no plan to make the route and the Phuoc An bridge a pay system, and it has the plan of the income by the port facilities use fee and the ship reach shore fee, etc. according to the hearing of BVPPC. Figure S3 shows the outline of the route. Figure S3 Outline of Cai Mep Thi Vai Inter-port Road km A feasibility study was carried out by BRITEC in 2009 and the results have been approved by BVPPC in August The title of the report is Report on Investment Construction Project of Cai Mep Thi Vai Inter-port Road, Ba Ria Vung Tau and Dong Nai Province (hereinafter referred to as BRITEC Report). This study reviews and updates, as appropriate, the BRITEC Report.

6 2.1.2 Outline of the Project Phuoc An Bridge and the approach bridges are described in a part of BRITEC Report. Results of the review and additional information on the Project are described below: (1) Route Length The route length is 21.3km from the south of Cai Mep- Thi Vai international port of the Ba Ria-Vung Tau Province to the road to the Phuoc An industrial port of the Dong Nai Province. (2) Phase No.1 and Phase No.2 Component No.9 is divided into Phase No.1 and Phase No.2. The Phase No.1 length is about 1.55km from Km to Km19+650, and the road of Phase No.1does not cross the Thi Vai river. The Phase No.2 length is about 3.26km from Km to Km And Phuoc An bridge, the approach road/bridge and grade-separated interchange at the end of alignment are included in the content of Phase No.2. Component No.0-No.8 and Phase No.1 of component No.9 schedules the completion in 2012, and Phase No.2 schedules the completion in Section of this study is this Phase No.2. (3) Design Standard, Classification, Design Speed Standard TCXDVN 104: 2007 (Urban Road Specifications for Design) Urban road classification: Main urban road Design speed (V) V=70km/ h Width of Right of Way (W) W=50m (4) Cross section of the road Typical cross sections are shown in Figures S4 and S5. Figure S4 Cross Section for Component No.9 (Phase 1) (source: BRITEC Report,2009)

7 Figure S5 Cross Sections for Component No.9 (Phase No2) (source: BRITEC Report,2009) Approach Bridge Phuoc An Bridge (5) Interchange plan at the end of alignment The end of component No.9 that is the end of the Cai Mep- Thi Vai Inter-port road is connected with the road to Phuoc An industrial port by the interchange of the trumpet type (Refer to Figure S6). The BRITEC Report on the Cai Mep- Thi Vai Inter-port road is completed, and a part of section is under construction now. However, there is only this simple drawing for the interchange at the end of alignment now. Figure S6 Proposed Interchange at the End of the Project (source: BRITEC Report)

8 The road profile is shown in Figure S7. Figure S7 Road Profile (source: BRITEC Report) Outline of Plan of the Road to Phuoc An Port (Dong Nai Province) As for the construction of the road to a Phuoc An industrial port, the subsidiary company(phuoc An port Investment Exploitation Petro Company) of Vietnam Petro who is the donor of the Phuoc An port project plans to execute it. A part of Phuoc An port and the road to a Phoc An industrial port schedule the opening in And, the F/S report by the PORTCOAST consultant will be completed soon. There are a railway plan and an existing gas pipeline in the approach bridge section. In hearing with DNPPC (Dong Nai Provincial People s Committee), it is said that there is no specific program of the railway at all. The existing gas pipeline (The size of the pipe seems to be Φ200mm) is laid to the Phuoc An industrial port schedule ground. There is no concrete relocation plan now. It is necessary to secure the distance from the gas pipe by both sides 12.5m for each according to the safety standard in Vietnam. The distance on safety is secured by 25m for each in the FS report by the PORTCOAST consultant. The outline of the plan of Dong Nai Province is shown in Figure S8.

9 Figure S8 Outline of the Plan of Dong Nai Province km The cross section of the road to Phuoc An Industrial Port is shown in Figure S9. The half section is scheduled to be constructed in Phase No.1. The width of 19m on both sides contains the frontage road space in the future. Figure S9 Typical Cross Section of the Road to Phuoc An Industrial Port (Source: Dong Nai Provincial People s Committee) 2.2 Basic Policy for Implementation of the Project Traffic Demand Forecast There is no description that used the numerical value for traffic in the future in BRITEC Report report. In hearing with the BV-DOT and BV-consultant, the adoption of the number of four lanes is assumed to have followed the content that the government referred in the past. In this study, to confirm traffic and the number of lanes in the future, the traffic demand forecast was done.

10 The Comprehensive Study on the Sustainable Development of Transport System (VITRANSS 2), JICA Study, was conducted from July, 2007 to Sep, This study prepared person OD tables for 2008 by vehicle type based on the existing traffic pattern. In addition, it prepared person OD tables by vehicle type for 2010 and 2020 based on future socio-economic indicators, including population, number of jobs, etc., for each traffic zone. Afterwards, the zone was dropped from Province to District in "Survey & FS of Dau Giay - Phan Thiet Expressway Project". Thereafter, the study for Missing Road of Ho Chi Minh City was conducted. In this study, a peripheral road plan was reviewed as FS review of VITRANSS 2, and the traffic demand forecast for the years of 2030 and 2020 was done. In this study, the Cai Mep-Thi Vai international port zone is made as an independent zone by using the above-mentioned final network. And, the traffic demand forecast for the year of 2030 and 2020 was conducted being divide the amount of the freight in the future of Cai Mep - Thi Vai port and Vung Tau port. Based on the traffic demand forecast, it is considered reasonable to assume the required number of lanes is four (4) for Cai Mep - Thi Vai Inter-port road. As a result, the total lane number including the mixed lane is six (6) Natural Conditions (1) Geographical and Geological Conditions The project area is located approximately 40km southeast of Ho Chi Minh city, where the Quaternary geology sediment, which is likely to seen at delta area, is mainly distributed since the location is outer Mekong Delta Area. The soil properties of the area are mostly composed of alluvial deposits, and the geological epoch is relatively young. Stretch of mangrove forest is covering over natural low-lying area around the project area. In general, low-lying area near a river mouth tends to show some particular phenomena due to the influences of ebb and flow and/or ocean waves, such as (i) repeatedly fluctuation of pore water pressure due to ground water level change, (ii) erosion due to water flow and waves, (iii) softening of soil due to permeation and water exposure, (iv) eluviation and deposition of sodium, and (v) deflation and hardening of soil. (2) Seismic Activities In regard to the seismic activities in the south VietNam, sixty four (64) times of seismic activities have been observed since the beginning of the seismic observation started The depth for seismic center is relatively shallow; around 10km to 20 km from ground elevation, whereas not any earthquakes have been recorded near the project area. Referring to Figure 3-21 extracted from Vietnamese standard of SPECIFICATION for BRIDGE DESIGN (22TCN ), the seismic class for this project shall be specified as Class 6.

11 (3) Navigation Clearance The navigation clearance for this project, which was approved by VietNam Maritime Department by a letter 614/CHHVN-KHDT dated in April 3rd, 2009 (refer to Appendix-3), is shown in below table. Table S1 Navigation Clearance for Phuoc An Bridge Class of Vessel 30,000DWT Navigation Height(H) Mmax1%(+1.60m)+ 55.0m Navigation Width(B) 120m(for one way flow) 239m(for two ways flow) (Reference:BRITEC Report, 614/CHHVN-KHDT) (4) Other Natural Conditions Data and information for other natural conditions, such as for climate/weather, river characteristics, wind velocity/direction, were collected during the site survey. This study considered the data and information Engineering Study (1) Selection of Bridge Type of Phuoc An Bridge The following three types are compared for Phuoc An Bridge based on the navigation requirement of the width of 239m. The center span length is assumed to be 360m or more considering the foundation size and the allowance. Type 1: Cable Stayed Bridge Type 2: Suspension Bridge Type 3: Arch Bridge The comparison results are shown in Table S2. Based on the comparison, a cable stayed bridge (Type1) is selected due to economic efficiency and control of maintenance. Figure S10 shows the general view of Phuoc An Bridge and the approach bridges.

12 Table S2 Comparison of Bridge Types Bridge Type Estimation Economic 1.00 Due to structural feature, a Constructive Large horizontal force doesn't operate on foundation. Maintenance Because Girder and Pylon are concretes, The repainting painting are unnecessary. recommended practice Economic 1.25 Because a large horizontal force Constructive operate on Anchorage, the foundation dimension broaden Maintenance Because the girder is a steel, it is required to repaint the painting of the girder though the concrete Pylon. Economic 1.20 Because a large horizontal force Constructive operate on Foundation, the foundation dimension broaden Maintenance Because the arch rib is a steelmade, it is required to repaint painting though the concrete girder. There are a lot of numbers of materials, and the operation and Type3 Type2 Type1

13 Figure S10 General View < To Vung Tau To Dong Nai >

14 3. Scale of the Project 3.1 Construction Cost Table S3 shows the construction cost based on the preliminary calculations. The construction cost is approximately 21.2 billion JPY, or 4,986 billion VND. Assuming 10% of the construction cost for each of the consultant fee and the contingency, the total cost is approximately 25.5 billion JPY, or 5,938 billion VND. Table S3 Preliminary Construction Expense Item JPY(Mill.) VND(Mill.) Equivalent JPY(Mill.) Equivalent VND(Mill.) General Item ,522 2, ,004 Approach Bridge L=2,478.5m W=23.5m 5,963 1,127,364 10,801 2,516,696 Main Bridge L=746m 5, ,599 7,411 1,726,693 Accessories L=3,260m , ,121 Approach Road Km to Km , ,105 L 280m Interchange 1 Lot 61 80, ,432 Construction Cost 11,920 2,170,577 21,236 4,948,051 Consultant Fee 10% 1, ,058 2, ,805 Contingency 10% 1, ,058 2, ,805 Total 14,305 2,604,693 25,484 5,937, Calculation of Ratio of Material, Equipment and Others of Japan Origin Table S4 shows the calculation of a ratio of material, equipment and others of Japan origin based on the guidelines prepared by relevant ministries of Japan. As shown in the table, the 30% condition for STEP scheme is satisfied. Cost for Japanese Technology Table S4 Ratio of material, equipment and others of Japan origin Item Cost JPY( Mill.) Remark Material 2,511 Sub total (ii) estimated in Table 8-5 Machine t 225 Procured from Japan Stay cable 812 Stay Cables (Material and installation cost) Wind test tunnel 10 Contain test Model Cast in pile 1,676 D=2.5m for Main bridge (Material and installation cost) Engineering 2,124 10% of Construction cost (assumption) - General and administrative cost: 7% - Site office overhead: 3% Total (i) 7,357 About 73 hundred-millions Total Project Cost (ii) 21,236 About 212 hundred-millions Ratio 34.6% >30.0% (i)/(ii) *: Material const shown in table 8-3 is exclusive of the material cost for stay cables. *: Engineering cost is assumed as a summation of General and Administrative cost (7%) and Site Office Overhead (3%: remuneration for Japanese engineers).

15 3.3 Overview of Preliminary Economic/Finance Analysis Economic Analysis In order to evaluate the effectiveness of this project from the viewpoint of the national economy, a comparative analysis of economic cost and benefit both in the case of executing the project (With the project) and not executing the project (Without the project) is carried out. As the evaluation index, Economic Internal Rate of Return (EIRR), Benefit Cost Ratio (B/C Ratio) and Net Present Value (NPV) are applied. The results of the analysis based on the assumed benefits and costs are shown in Table S5. As all the index values for the evaluation are at a good level, this project is considered to be economically feasible. Table S5 Results of cost benefit analysis (Discount Rate=15%) B/C Ratio Net Present Value (NPV) EIRR million US$ 27.5 % In the elements assumed for the economic analysis, variable factors are included in each element and some elements are based on simple assumptions. As a sensitivity analysis, some margin will be given in accordance with such variable factors and by finding out how the result of the analysis will vary; the stability of the feasibility of this project will be confirmed. The result of the sensitivity analysis is shown in Table S6. Table S6 Result of Sensitivity Analysis on Economic Analysis Benefit Cost -20% -10% 0% 10% 20% 20% 38.0% 34.8% 32.0% 29.6% 27.5% 10% 35.6% 32.5% 29.8% 27.5% 25.5% 0% 33.1% 30.1% 27.5% 25.3% 23.3% -10% 30.4% 27.5% 25.1% 22.9% 21.1% -20% 27.5% 24.8% 22.5% 20.5% 18.7% From the results of analysis shown in the above table, the value of EIRR exceeds 15% even in the case of 20% cost increase or 20% benefit decrease so the possibility of realization of this project is high Financial Analysis The FIRR of the Project is 3.37% when the toll is assumed to be 2US$/PCU in the year of As the value of 3.37% exceeds the standard value of 2.89% calculated based on the assumed proportion of invested JPY and VND, the Project is considered to be financially viable. In the elements assumed for this analysis (Investment cost and revenue), unknown factors are included. Some margin will be added to each element corresponding to each unknown factor, the variation of the

16 result of the analysis is observed and the financial stability of this project will be verified. The result of the sensitivity analysis on the financial analysis is shown in Table S7. From the table, it is found that the value of FIRR does not satisfy the standard value by WACC in case of 10% cost increase and 10% revenue decrease. Accordingly, the project shall be executed based on the proper construction plan and operation plan. More specifically, the application of low interest and long term finance such as STEP special Yen credit is an essential condition. Table S7 Result of Sensitivity Analysis on Financial Analysis Revenue Construction cost -20% -10% 0% 10% 20% 20% 6.02% 5.22% 4.52% 3.91% 3.37% 10% 5.42% 4.64% 3.96% 3.37% 2.84% 0% 4.79% 4.03% 3.37% 2.79% 2.28% -10% 4.11% 3.37% 2.73% 2.17% 1.66% -20% 3.37% 2.66% 2.04% 1.49% 1.00% 3.3 Considerations on Natural and Social Environments The Project for development of Cai Mep-Thi Vai International Port is now progressing. The Cai Mep-Thi Vai Inter-Port Road Construction Project which includes the Phuoc An Bridge Construction Project is considered as a part of the Project for development of Cai Mep-Thi Vai International Port. The EIA study for the Cai Mep-Thi Vai International Port Project has already been conducted by the project proponent and approved by MONRE and DONRE. According to the EIA report for the port development project above mentioned, potential impacts on the environment, both natural and social, arising from the implementation of the project are concluded to be not serious one. Apart from the EIA study for the Cai Mep-Thi Vai International Port Project, EIA studies for the Component No.9 of the Inter-port road are also required according to the Vietnamese environmental related laws and regulations. The EIA for the Phuoc An Bridge construction project has not been conducted yet. Due to the reason that the Phuoc An Bridge stretches over two provinces, Ba Ria-Vung Tau and Dong Nai, the EIA report prepared is appraised and approved by MONRE. This study is conducted in the earliest phase of the decision making process. The major objective of Environmental and social considerations in project formation studies is to provide data to determine whether the project should be taken to the next phase, and to clearly identify a broad range of items to be investigated in the next phase, if the project goes forward, from an environmental and social standpoint. According to the JBIC guidelines, all proposed projects are to be classified into three categories, namely those likely to have a significant environmental and social impact (Category A), those likely to have a less adverse environmental and social impact than that of Category A projects (Category B), and those likely have a minimal or no adverse environmental and social impact (Category C). Based on the conclusion of the EIA of the Cai Mep International Port development project, the Project of Phuoc An Bridge can be classified into Category B project. Although submission of EIA reports to JBIC is not a mandatory

17 requirement for Category B project, it is recommended that the project proponent should submit the EIA reports and environmental permit certificates issued by the government of Vietnam or other appropriate authority following Category A projects. In this study, major impacts on natural and social environments are reviewed in accordance with the JBIC screening formats. The results are attached in the main report of this study. 4. Implementation Schedule A tentative schedule from the present time to completion of the construction is shown in Table S8. At the beginning, implementation method is discussed among relevant authorities in Vietnam. When the implementation by Japanese ODA is selected, GOV (Government of Vietnam) request to JICA Hanoi for the ODA application followed by bilateral discussion and investigation on the Project. In Table S8, it is assumed that SAPROF (Special Assistance for Project Formation) is carried out because of the immature level of BRITEC Report. When both countries agreed, the L/A (Loan Agreement) is signed by the two countries based on the agreed TOR (Terms of Reference) of the ODA. A required period for the said process varies depending on the contents of a project. Based on the information of the past similar projects, the time of the L/A is assumed to be January After the L/A, works including selection of the consultant, the design phase and bidding for contractors are carried out. The period of the design phase is assumed to be 11 months including F/S review, B/D (Basic design) and D/D (Detailed Design). The commencement time of the construction is assumed to be October The construction would require 41 months based on the study resulted in the completion time of the end of February Feasibility on ODA Request and Implementation The Project is currently planned by BVPPC although it has been included in the traffic master plan of HCMC region. The first step for BVPPC is to request the MOT for probability of ODA implementation. Funding by GOV is not likely because of the large project scale. Private sectors may be reluctant to invest on the Project because of the large scale and the low FIRR. In addition to these financial problems, the Project requires the state-of-the-art technology on the design and construction of a cable stayed bridge. The technology has not fully established in Vietnam. Because of these reasons, BVPPC hope that Phuoc An Bridge is constructed by Japanese ODA having high reputation on the quality and schedule management. Therefore, no serious obstacle are found for the ODA implementation. Many foreign countries, such as China, Korea and Switzerland, are investing on the port facilities and factories in nearby industrial parks. Under the situation, Japan is expected to provide advice and assistance for the implementation of the Project. This would be a good opportunity for Japan to impress people with its existence.

18 Table S8 Entire Project Schedule (tentative)

19 6. Superiority of Japanese Firms in Technology As stated foregoing, design and construction of a cable stayed bridge of which center span is 360m requires not only sophisticated knowledge but also high-developed equipment and materials. Japan has vast of overseas experiences and lead the state-of-the-art technology in this area. Moreover, the Japanese technologies and experiences for wind tunnel tests and wind-resistant stability design are also leading the edge of the world. Additionally, some other Japanese technologies, which are applicable to the Project, such as Vacuum Consolidation Method (VCM) for soft ground improvement, Screwed Steel Pile foundation and Structural Health Monitoring System (SHMS) are also quite unique and competitive technologies. Based on the above, it is quite apparent that Japanese firms have enough competitive power and a possibility of participation to the Project. As stated above, Japanese firms have sufficient competitiveness in terms of economic efficiency, quality control and resolution of technical difficulties, etc. Consequently, application of the technologies, which make the participation of Japanese firms who are familiar to the leading-edge technologies developed by Japan dominantly, is essential to this project. It is recommended to propose and exhibit above competitiveness of Japan working on the cutting edge of bridge engineering. This approach would also provide Japanese firms and technologies with good opportunities of orders. 7. Specific Schedule until L/A and Potential Risks for Implementation Table S9 shows a tentative schedule from the present time to L/A. No considerable risks are found in the schedule because the counterpart wish to complete the Project under STEP scheme of Japanese ODA. Many large scale road/bridge projects are simultaneously ongoing in Vietnam, in some of which the schedule is behind the original one. The main reason is the resettlement and land procurement. In this Project, however, almost no people are living in the area. Therefore, social problem could be solved relatively easy once compensation for fishery and shrimp farming is smoothly agreed. One little concern may be a possible delay of the process due to negotiation and administrative procedures among the two countries, which could be managed by close communication and cooperation. In Table S9, the time of L/A is assumed to be January A potential risk to decelerate the implementation schedule may be an internal factor of the two countries. 8. Project Location Map Figure S11 shows the project location.

20 Table S9 Tentative Schedule from Present to L/A and Design Phase

21 N HANOI Figure S11 Project Location DA NANG HCMC 0 200km Bien Hoa HCMC Long Thanh Airport Express Highway Ben Luc National Highway Ben Luc-Long Thanh Exp. Industrial Aria Phuoc An Bridge Cai Mep-Thi Vai Inter-Port Road km Cai Mep-Thi Vai Inter-Port Vung Tau