Vietnam can afford multi-billion-dollar airport if gov’t spends less: official

By Hoang Thuy, Vo Hai   October 27, 2017 | 04:41 pm GMT+7
Vietnam can afford multi-billion-dollar airport if gov’t spends less: official
A design for Long Thanh Airport. Photo courtesy of the Airports Corporation of Vietnam

Government's recurrent expenditure could reach $40bln this year, and more than half of it will go on salaries and bonuses.

Government's recurrent expenditure has been on the rise in recent years, but some cut-backs could bring Vietnam closer to its multi-billion-dollar airport dream, according to a high-ranking official.

(Recurrent expenditure refers to payments made by governments for all purposes except capital costs, including payments made on goods and services as well as interest and subsidies.)

Pham Minh Chinh, head of the Communist Party's Central Organizing Commission, which is mainly in charge of nominating and appointing government officials across Vietnam, said that government funding would be the most practical answer for the Long Thanh Airport project to move forward.

“We need to save money,” Chinh said at a meeting on Friday during the ongoing session of the legislative National Assembly. (He is also an elected legislator.)

Basic site clearance for the new airport in Dong Nai Province, around 40 kilometers (25 miles) from Saigon, will cost an estimated $1 billion, but the government has budgeted less than a quarter of the money.

Chinh said that government's recurrent expenditurespending has increased 2.2 times from five years ago, which is "too much."

Spending is expected to reach VND900 trillion (nearly $40 billion) this year, more than half of which will go on salaries and bonuses.

Site clearance for the airport only needs 2 percent of that, he said.

He said if the government can tighten spending by 2 percent for five more years, there would be enough money for the first phase of construction, which is expected to cost VND120 trillion ($5.28 billion).

Long Thanh Airport is planned to cover 5,000 hectares (12,400 acres), replacing Tan Son Nhat as the country’s largest airport with an annual capacity of 100 million passengers and five million tons of cargo. The first part is scheduled for completion in 2025 and will be able to handle 25 million passengers a year.

Tan Son Nhat currently receives 32 million passengers a year, far beyond its designed capacity of 25 million.

The new three-phase project will cost an estimated $16 billion in total.

More than 15,500 people will be displaced for the project.