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Vientiane Logistics Park (VLP) PPP project in Lao PDR

16 September, 2014

JICA Study Team

Table of Contents

Background

VLP Project Summary

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Background

• Regional Integration of GMS

– CBTA (Cross Border Transport Agreement)

– International corridors development

• Trade Facilitation in ASEAN

– AFTA (ASEAN Free Trade Area)

– AEC (ASEAN Economic Community)

– ASEAN Single Window in Customs

From Land-locked country to Land-linked country by:

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Borderless of GMS by Freight Corridors

• Infrastructure

– NSEC (NR-3)

– EWEC (NR-9)

– CEC (NR-13)

– NEEC (NR-4)

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Project Summary

1. VLP Development Story 2. Project Signification 3. Signification of PPP Scheme 4. VLP Development Policy 5. VLP Logistics Function 6. VLP Project Site 7. VLP Project Structure 8. Tentative Project Schedule

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1. VLP Development Story (1)

2006 : The Feasibility Study, JETRO 2009 : The Comprehensive Study on Logistics System, JICA

2014 : The PPP Preparatory Study, JICA 2017 : VLP Operation Start (Tentative Plan)

■Main Development Story

■ Main Objectives of The PPP Preparatory Study

• Anticipated business based on potential customers

• Physical plan based on the anticipated business of VLP

• Preparation of VLP development & management entity based on PPP

• Risk Analysis on anticipated business operation of VLP • Supports to MPWT to obtain IEE license

• Preliminary discussion on loan arrangement

• Preparation on concession agreement from MPI

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1. VLP Development Story (2)

■Farther Financial Arrangement (tentative)

• JICA Private Sector Investment Finance (PSIF) Loan is expected to be utilized as a financial source of VLP project.

JICA PSIF Loan:

• JICA initiated PSIF Loan as a new financial support scheme in 3 years ago.

• Possible to finance to private company

• Faster and simplified procedure of loan approval

• Concessional ODA loan

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2. Project Signification

• Promotion of streamline and upgrade of Logistics function at international standard level

• Promotion of FDI from neighboring countries, especially, Thailand

• Linkage with Industrial park development

• Promotion of logistics-hub potential in GMS

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3. Signification of PPP Scheme

• To engage in technical transfer in regard to logistics business in high standard level

• To accelerate FDI from foreign countries

• To upgrade logistics credit with holding compliance rule

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4. VLP Development Policy

Multi-Service: Business Incubation Information Service High-speed

Logistics Service Support and

Relevant Business

Truck Railway Transshipment

VLP Multi-Activity:

International Logistics Domestics Logistics Dedicated Logistics Inventory Management

Multi-Modality:

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5. VLP Logistics function

• Interface import, export, and domestic freight

• Provide transit and break-bulk transport services

• Serve as a distribution center of the Vientiane and northern/central area

• Provide inventory management and storage services of goods to and from the Mekong Region in Thailand

• Provide distribution processing of import from Thailand in a short term, distribution processing of transit freight from China to Thailand in a short to mid term, and inventory management of parts, components, and semi-processed in a mid to long term

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VLP（Vientiane Logistics Park）

Thanaleng Terminal

Railway Plan of Chinese F/S

Railway Plan of

NEDA (Thailand)

Freight Station of

Chinese F/S

6. VLP Project Site

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Thanaleng

Warehouse

7. Tentative VLP Project Structure

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GovernmentofLao(e.g.,MPI,MOF,MPWT)

SPC(JointVenturebetweenPrivateCompanyandLaoGov.)

(LaoRailway) Loan(e.g.,JICAPSIFLoan)

ProjectConcession,EquityInvestment,etc.

(Target:LocalandInterna onallogis cscompanies)

Tenant1

Tenant2

Tenant3

TenantX

・・

Transporter,CargoOwner,TruckingCompany,etc.

LeaseService LeaseFee

Loan

Repayment

LeaseService LeaseFee

(MOAF,MOFA)Immigra onand

Quaran ne

ServiceProvision

Fee

(MOIC)U lityProvider

Provision

Fee

(Vien aneCapital) IEEsubmission

Permission

Harmoniza onofCY

developedbyNEDA

8. Tentative Project Schedule

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2014 2015 2016 2017

<ConsessionAgreementnego a on>

(C.A.Contract) <DickeringofSPCforma on>

(SPCforma on)

<Prepara onofSPCforma on>

(StartofConstruc on) (StartofBusinessOpera on)

<Applica ontoJICAloan>

(Exceu onofJICAloanagreement)

(Establishmen ofLaoGov.

CommissionforSPC)

<PreparatoryStudybyJICA>

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End of Presentation