The World Bank has provided a $613.5m loan to Vietnam for the Da Nang-Quang Ngai Expressway project.

The entire project is expected to cost $1.4bn and funds will also come from the Japan International Cooperation Agency.

World Bank Vietnam country director Victoria Kwakwa said: "This is the first time that the World Bank is financing the development of an expressway in Vietnam. This is in recognition of Vietnam’s need for modern infrastructure as it addresses emerging challenges of a lower middle income country."

The Da Nang-Quang Ngai Expressway project will enhance safety for road users travelling between the city of Da Nang and Quang Ngai province, as well as ensuring there is an institutional capacity for expressway development in Vietnam’s Ministry of Transport. The new highway will be 131km long, with a width of 26m, have six lanes, 126 bridges and one tunnel.

The project has two components; the first is the Da Nang-Quang Ngai road itself. This involves the construction of a two-lane highway, including bridges from the southern end of the expressway to national highway 1A, in Quang Ngai province, as well as compensating and rehousing residents affected.

The second component is project implementation support and institutional strengthening. This includes the provision of technical assistance to Vietnam Expressway Corporation (VEC) in relation to running the operation, including construction supervision, integrated review and monitoring, as well as capacity building for financial management.

Construction will start in the third quarter of 2012 and is expected to be complete in 2017. Once it is finished, the expressway will connect the National Highway 1A to the south of Da Nang city then to Quang Ngai province, and then back to National Highway 1A in Quang Ngai.

The World Bank believes the expressway will help ease traffic flow and improve access between the central areas of Da Nang, Quang Nam and Quang Ngai.