13th November 2008 (Hospodářské noviny) – The construction company PSJ will obtain the eight-billion contract; The loan for the construction will be provided to the Vietnamese side by Czech banks; Czech builders will start on the construction of a highway in Vietnam. PSJ, a Jihlava construction company, on Tuesday received the promise of a contract from the Vietnamese for the construction of a section of highway between the Vietnamese metropolis, Hanoi, and the port city Hai Phong. The value of the contract is estimated at 400 million dollars, which means cca eight billion crowns.
A preliminary memorandum was signed on Tuesday at the Vietnamese-Czech business forum in Hanoi by the Director of the Export division of PSJ, Jaroslav Jirkovský, and a representative of the Vietnamese bank, the Vietnam Development Bank. This bank acts as an investor in the entire project. However for funding such large-scale project, they will need a loan, which will be provided by the Czech side.
Czech banks will pay it
The loan provider will in part be the Commercial Bank and the other portion of the funds will be supplied by the Czech Export Bank. The role of the CEB is to provide loans to Czech companies expanding to foreign markets. CEB has already helped with the realisation of a large number of major business transactions, many of which are currently taking place in Vietnam, which is becoming an increasingly attractive export destination for the Czech Republic.
“So far, we have signed a contract for the construction of a cement plant in Phu Son, on a turnkey basis, in the order of 80 million euros (cca two billion crowns). The general contractor is the Czech company, Inekon Group. The next investment will be for a plant for the washing and processing of kaolin, in the range of half a billion crowns,” said Jan Stolár of the CEB.
Yesterday's memorandum is the result of more than two years of activity by PSJ in Vietnam, part of which has involved negotiating with the largest local construction companies.
“Undoubted advantages are the historical industrial links between our two countries, good contacts with Vietnamese investors and, last but not least, also the availability of interpreters,” Jirkovský commented on conclusion of the agreement.
“Although the eight-billion contract is sealed by the Memorandum, the official contract is still pending. Therefore we do not want to specify yet the exact date of commencement of construction of the highway; we will wait for the signing of the contract,” said Miroslav Fuks, spokesman for PSJ.
Nevertheless the PSJ Company is no newcomer to foreign contracts. Of Czech construction companies they belong amongst the largest and their list of realised projects includes, for example, the reconstruction of the recently opened Czech National building in New York and an extension to the berth and the Czech base in Tunisia.
Czechs go East
Also present at the signing of the memorandum for the construction of the highway yesterday was Minister of Industry and Trade Martin Říman, who went on a week-long business trip to Vietnam and India in order to promote trade relations between the Czech Republic and these countries.
The billion contract is at the same time a part of the long-term pro-export policy planning, which the Ministry of Industry and Trade launched under the name “The Export Strategy of the Czech Republic for the years 2006 – 2010” and which was approved in the year 2005 by the Government. “Czech companies are very active in Vietnam and they are concluding trades in the order of hundreds of millions to billions of crowns, or they are negotiating about them,” said Ministry Spokesman Matyáš Vitík to Hospodářské noviny.
Apart from the construction of the highway and the cement plant other major contracts are already being prepared, in which the CEB is also participating. Amongst others we can mention the construction of a large thermal power plant in southern Vietnam and on the agenda, for example, is a project of a new brewery. “In addition, we're looking for other investment projects, namely in the area of IT," said Stolár.