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25 April 2006 - The expansion of Vietnam's electricity system up to 2010 is to be financed by a consortium of four local banks. The banks will provide a VND42tn ($2.7bn) line of credit to Electricity of Vietnam (EVN) to bankroll power capacity development from, EVN director general Dao Van Hung said in Hanoi last week.
The banks making up the consortium are the Vietnam Industrial and Commercial Bank (Incombank), the Bank for Foreign Trade of Vietnam (Vietcombank), the Bank for Investment and Development of Vietnam (BIDV) and the Bank for Agriculture and Rural Development (Agribank).
The banks commitment was made at a signing ceremony for an agreement under which the banks will co-finance a VND1.77tn ($114m) package for construction of the 320 MW Ban Ve Hydroelectric Power Plant in the central province of Nghe Ans Tuong Duong District.
The preferential loan package will have a 12 year term with a grace period of three years, an annual interest rate pegged to the banks average interest rates for 12-month deposits, and a fee of three per cent per year.
Total capital for the Ban Ve project is expected to reach VND5.92tn ($382m). Remaining capital will come from EVN, preferential loans from a fund for site clearance, and foreign loans for mechanical facilities.
Electrical demand nationally is expected to post a solid annual growth of 16-17 per cent between 2006-10. To meet the rising demand, Hung said that EVN needs up to VND250tn($15.7bn) during this period for 32 planned projects with an additional capacity 16 805MW.
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