The Asian Development Bank (ADB) has agreed to loan Vietnam US$540 million to build an urban mass rapid transit (MRT) line in Ho Chi Minh City.
An ADB press release said a loan agreement to this effect was signed Friday.
The 11.3-kilometer line, including an underground section of 9.3 kilometers, is one of three MRT lines that will be developed in the southern city.
The project will significantly reduce HCMC"s traffic congestion and accidents as well as green house gas emissions, Ayumi Konishi, ADB's Country Director for Vietnam, said in the statement.
As one of the largest cities in Vietnam with a population of over nine million, HCMC has a huge number of private vehicles and a relatively weak public transportation system. Its road infrastructure is reaching "saturation point," the ADB release said.
Local traffic conditions will continue to worsen as more motorbike users switch to cars, it added.