Government calls for private capital for national infrastructure projects

While legislative regulations on Public Private Partnership (PPP) form has been just completed, a lot of investors pay much attention to PPP investment method through many forums in the context of Vietnam is capital for infrastructure development.

Even, PPP form also has boiled up the NA meetings on the express railway project.

In the margin of PPP Conference held lately in Hanoi, Noi Bai airport re-development project under PPP form was officially introduced. As designed, the project covers total 3,500 hectares with total estimated cost of $5-6 billion.

The investor proposing the project was an associated business including Airis International Holdings LLC, Zurich Airport, HSH Nordbank, KFW Bank, and Bank for Investment and Development of Vietnam (BIDV). The project still is only an idea.

PPP clearly is the real choice of many domestic and foreign investors.

Talking to the press, Ronald D.Factor, CEO of Airis Holdings LLC said that while not many private investors paid attention to the local airport investment and upgrading plans, PPP could become an effective measure helping Vietnamese government attract external capital sources.

In order to invest in infrastructure field, each country needs a huge funding, so calling for private capital into PPP form in infrastructure construction is developed in many nations like Korea, Philippines, Mexico, Chile, Australia or Peru. Similarly, investment capital for airport upgrading and building can be solved via PPP, Jim Winkler, director of Vietnam Competitive Initiative (VNCI) project of USAID gave his point.

Meanwhile, World Bank experts advised PPP form is the most suitable for Vietnam’s development plant in this context.

Reportedly, the government has approved the pilot of applying PPP form on two national projects on building Dau Giay-Phan Thiet and Ninh Binh-Thanh Hoa expressway sections. In late February 2009, Ministry of Planning and Investment (MPI) released Official Note 1076/BKH-KCHT&DT to propose WB’s funding support to both projects.

Also, Ministry of Traffic and Transportation already listed eight other infrastructure projects calling for private capital under PPP form. They are Da Nang-Quang Ngai, My Thuan-Can Tho, Noi Bai-Ha Long, Ha Long-Mong Cai, Dau Giay-Da Lat, Ben Luc-Long Thanh expressway sections, Hai Phong international port and HCM City-Can Tho express railway.

Meanwhile, Hanoi People’s Committee said the city will carry out some investment projects under PPP form in several fields of bridge and road construction, water drainage and environmental treatment, Ringroad construction and overhead road lines.

At this time, PPP remains a new investment form in Vietnam. MPI has completed the legislative frame on applying PPP in Vietnam and is waiting for government’s approval. If being passed, PPP in civil aviation construction is expected to attract many foreign investors.

Dau tu nuoc ngoai

Tags: Vietnam Infrastructure