On Saturday, Vietnam and Japan formalized their fourth loan agreement for Ho Chi Minh City’s metro line No.1 project, amounting to over JPY41 billion (US$288.48 million).

The signing ceremony took place in Tokyo, with Vietnamese Prime Minister Pham Minh Chinh and Japanese Prime Minister Kishida Fumio overseeing the exchange of collaboration documents. These encompassed the HCMC’s metro line, the Japan Development Scholarship (JDS) project, and the equipment supply project for Vietnam’s K Hospital, totaling JPY42.3 billion.

The loan agreement for the metro line falls under the Special Terms for Economic Partnership (STEP), a form of Japanese Official Development Assistance (ODA) reserved for projects capable of leveraging advanced technologies and expertise from Japanese companies. Such projects are mandated to use Japanese as the primary language in contracts or lead contractor joint ventures, with a minimum of 30% of materials sourced from Japan.

Japan’s previous financial commitments to the project were inked in 2007, 2012, and 2016, amounting to JPY155.3 billion ($1.09 billion).

HCMC’s metro line No. 1, also known as the Ben Thanh – Suoi Tien line, is slated to span 19.7 km from Ben Thanh Market in downtown HCMC to Long Binh Depot in Thu Duc City.

Currently at 97% completion, the project has faced delays since its initiation in 2012. With a total cost exceeding VND43.7 trillion ($1.85 billion), the line comprises three underground stations and 11 elevated ones. The project is anticipated to conclude this year and commence commercial operations in 2024.

🏆 Japan holds the position of Vietnam’s primary ODA partner. As of the conclusion of the 2020 fiscal year, Japan had provided Vietnam with a cumulative ODA of JPY2,821.2 billion ($27.5 billion).

✈️ Prime Minister Chinh is currently in Japan as part of his itinerary, attending the Commemorative Summit for the 50th Year of ASEAN-Japan Friendship and Cooperation and engaging in bilateral activities in the country.