Seeking Solutions to Address Funding Challenges for the Hanoi Capital Region Ring Road 5 Project

On the afternoon of July 4, Pham Gia Tuc, Member of the Politburo, Secretary of the Party Central Committee, and Permanent Deputy Prime Minister, chaired an online conference between the Government, central ministries and agencies, and the authorities of Hanoi, Hai Phong, Ninh Binh, Hung Yen, Thai Nguyen, and Phu Tho to discuss funding solutions for the Ring Road 5 – Hanoi Capital Region Investment Project.

The conference focused on financing options for the project. At the Phu Tho meeting venue, the session was chaired by Quach Tat Liem, Vice Chairman of the Provincial People’s Committee.

According to the Ministry of Construction, the pre-feasibility study report for this major infrastructure project is being finalized for submission to the Government before July 6, 2026. The proposed route will extend approximately 349 kilometers, passing through seven provinces and centrally governed cities. The main route is designed as a six-lane expressway, while the parallel roads will be built to at least Class III road standards with two lanes. In the mountainous sections crossing Phu Tho and Thai Nguyen, additional collector roads will be constructed to improve local connectivity.

The project’s preliminary total investment is estimated at approximately VND 298 trillion, including around VND 81 trillion for land acquisition and site clearance. Under the proposed financing plan, the central government budget is expected to provide approximately VND 226 trillion for construction of the main expressway and land clearance for the main route, while local governments will contribute about VND 72 trillion for the parallel road system and the remaining land clearance costs.

Once completed, Ring Road 5 will provide direct connections to six radial expressways, creating an important transport corridor linking the Capital Region and the Northern Midlands and Mountainous Region with Hai Phong Port. The project is expected to become a major driver of growth for the country’s key economic region, which accounts for 27% of Vietnam’s population and contributes 32% of national GDP, while significantly easing traffic congestion at the gateways to the capital.

Vice Chairman of the Phu Tho Provincial People’s Committee Quach Tat Liem addresses the conference.

Speaking at the conference, Vice Chairman Quach Tat Liem emphasized that the project is of strategic importance to the development of both the Capital Region and Phu Tho Province. According to the province’s review, approximately 76 kilometers of the route within Phu Tho will require upgrading or new construction after excluding the 14.25-kilometer section that overlaps with the existing expressway.

He noted that the proposed alignment is now fully consistent with the province’s master planning. Phu Tho has proactively coordinated with the Ministry of Construction and consulting units to complete field surveys, provide technical input, and participate in the State Appraisal Council’s review process.

However, he also acknowledged a major challenge. The estimated cost of constructing the parallel road system has risen significantly to approximately VND 10.05 trillion, placing considerable pressure on the province’s budget. To ensure that the project proceeds on schedule without imposing excessive financial strain on the locality, Phu Tho proposed that the Permanent Deputy Prime Minister consider two options: allowing the parallel roads (collector roads) to be implemented in phases, or providing 50% central government funding support, equivalent to approximately VND 5 trillion.

Concluding the conference, Permanent Deputy Prime Minister Pham Gia Tuc highly appreciated the determination and proactive efforts of the Ministry of Construction and the participating localities. He stressed that Ring Road 5 is a strategic transport artery that serves the interests of both the nation and the entire region. Implementing the project, he said, is not only an economic development task but also a particularly important political responsibility.

The Permanent Deputy Prime Minister assigned the Ministry of Construction to conduct a comprehensive review of the project’s total investment and provide clear explanations for cost adjustments. The Ministry of Construction, in coordination with the Ministry of Finance, was instructed to study and propose flexible financing solutions, giving priority to implementation under the public–private partnership (PPP) model and resorting to full public investment only when absolutely necessary. The ministries were also tasked with developing special policy mechanisms for submission by the Government to the National Assembly, while exploring additional funding sources through infrastructure bonds, Government bonds, and the flexible use of surplus central government revenue as well as contributions from economically stronger localities.

Permanent Deputy Prime Minister Pham Gia Tuc requested the Ministry of Construction to urgently finalize the report for submission to the Government and the National Assembly’s Finance and Budget Committee for appraisal, ensuring that the project is ready for consideration at the upcoming session of the National Assembly. He also called on the leaders of the participating provinces and cities to promptly report the project to their respective Provincial Party Standing Committees in order to build broad consensus throughout the political system and accelerate the project’s implementation.

Dinh Vu