February 12, 1998 (HO CHI MINH CITY, Vietnam) -- Vietnam Post and Telecommunications Corp. (VNPT) will invest US$20 million in the China-U.S. international submarine optical cable project called CSC 2.4/GB/C, a VNPT official said.

VNPT chief Dang Dinh Lam said that the deal will help the company prepare for telecommunications, data communications and Internet services between Vietnam and North America.

VNPT is a business unit of the Directorate General of Post and Telecommunications (DGPT), a government agency in charge of telecommunications.

The cable line will link China with the United States, Japan and Korea early in the next century. Lam said 565km of the cable line will pass through Vietnam.

"We are now inviting tenders for the supply of optical cables and equipment," Lam said.

In 1997, Vietnam became involved in the construction of the 38,000km Asia-Europe cable project called Se-Mea-We3, which is expected to be connected with the China-U.S. project in March 1999.

In November 1996, former Vietnamese prime minister Vo Van Kiet signed an agreement to provide US$35 million to VNPT to participate with international telecom organizations to build an undersea optical-fiber system linking all the countries of the Asia-Pacific region, the Middle East and Europe. That project was launched by ASEAN countries, Japan, France and the United States.

"Vietnam directly connects to only 40 countries and indirectly to 200 countries, and if we share this international telecom project, we can directly connect to all countries," said Mai Liem Truc, director general of DGPT.

Also, VNPT seeks to develop another North-South optical cable line running parallel with the country's planned second backbone road, Truc said.

The country has built eight ground satellite stations for the Interspunik and Intelsat systems and a maritime optical-fiber cable linking Vietnam with Thailand and Hong Kong, he noted. However, he also said that Vietnam's telecom services remain slow and not well developed.

In November 1997 Vietnam started operating a trans-Vietnam optical-fiber telecom link between Hanoi and Ho Chi Minh City. According to Truc, the facility, with a capacity of 30,000 telephone calls, will be the major telecom artery for all voice, data and video transmission throughout Vietnam. Only 24 of Vietnam's 61 provinces are connected.

"The government allowed VNPT to participate in building the international submarine optical-fiber cable project to increase Vietnam's telecom capacity," Truc added.

After the new cable project is finished, Vietnam will have a better capacity to meet demand for telecom services.

"The CSC 2.5 GB/C optical-fiber cable that Vietnam and China are building in 1998 will soon link Vietnam, China, Laos, Thailand, Malaysia and Singapore with the United States and Japan," Truc added.

Keyword: DGPT is the Directorate General of Post and Telecommunications, the governmental agency in charge of Vietnam's posts and telecommunications. It is a ministerial-level body. DGPT owns the monopoly consortium Vietnam Post and Telecommunications.

(David Tran, Asia BizTech Correspondent)