Boston, MA -- (ReleaseWire) -- 09/28/2012 -- BMI View: Construction activity in Vietnam continued to contract in Q212, prompting us to revise down our full-year forecast for the construction sector. Real growth for 2012 is now expected to come in at just 0.1% (down from a previous forecast of 4.9%). Despite this downward revision, we remain convinced that a robust recovery is still on the cards for Vietnam's construction industry as monetary conditions become increasingly conducive for construction. This expectation is reflected in our forecasts, with construction real growth anticipated to reach 6.9% in 2013.
The major developments in Vietnam's infrastructure sector are:
- In May 2012, a joint venture (JV) comprising South Korea's Daelim Industrial and Japan's Sojitz Corporation has been awarded a US$826mn contract to provide plant equipment for the 1,200MW Thai Binh 2 coal-fired power plant. Under the terms of the agreement, the JV is to install and test-run boilers, turbines and two generators for the US$1.6bn Thai Binh 2 plant, according to the Vietnamese government, cited by Reuters. If completed, the Thai Binh 2 plant would be the largest conventional thermal power plant in northern Vietnam.
- In June 2012, the Vietnamese government approved Vietnam Railway Corporation's railway development plan for the 2012-2015 period. The plan will involve a total investment of VND200trn (US$9.5bn), with VND195trn (US$9.28bn) to be directed towards the upgrading and construction of new railway lines and connecting them to major ports, industrial zones and tourist attractions. The plan also entails the upgrading of the north-south Thong Nhat railway. Preparations to build railway routes connecting Hanoi and Ho Chi Minh City, and the double tracking of the Lao Cai-Hanoi-Hai Phong and Hanoi-Dong Dang corridors are scheduled to be concluded.
- In June 2012, Thailand-based Italian-Thai Development has signed a memorandum of understanding to carry out a study on the 151.5km Halong - Mong Cai expressway project in the Quang Ninh province. The Halong - Mong Cai expressway, which is part of the Noi Bai - Halong - Mong Cai expressway project, is estimated by the Vietnamese transport ministry to cost US$1.5bn. The expressway is to be completed within three years.
- In July 2012, the Vietnamese government selected three thermal power plants that are to use locally manufactured power equipment, reports Intellasia. Through the use of local power equipment, the government is aiming to increase the capacity of domestic power equipment manufacturers and end low-quality power equipment imports, which arrive mostly from China. The three plants in question are: the Vinacomin-invested Quynh Lap 1 in Central Nghe An province; the PetroVietnam-invested Song Hau 1 in Southern Hau Giang province; and the PetroVietnam-invested Quang Trach 1 in Central Quang Binh province.
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