According to the ministry, PPP investment, , including BOT (build-operate-transfer) form, are currently regulated by Decree 15/2015/ND-CP on PPP investment and Decree 30/2015/ND-CP guiding the implementation of some articles of the Law on Bidding, as well as several other documents.
A BOT project in the northern province of Ninh Binh
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Inspection and audit results on build-operate-transfer (BOT) and build-transfer (BT) projects showed that most projects applied limited tendering in choosing investors, leading to low competitiveness and a lack of transparency. Meanwhile, the announcement of projects and list of projects has yet to be implemented in an open manner.
The supervision of projects’ implementation has been also ineffective, leading to low quality construction works and many other problems.
Besides, the lack of this regulatory mechanism has also discouraged foreign investors from joining transport infrastructure projects in Vietnam. Thus, up till now, no PPP transport infrastructure projects have been successfully done by foreign investors in the country, despite their great interest.
Vietnam also needs private investment in the infrastructure development as the state cannot afford it. The Ministry of Transport estimated that the total capital for developing the transport infrastructure in the country for 2018-2023 is estimated at roughly VND1,015 trillion (US$48 billion).
Accordingly, some VND651 trillion ($28.67 billion) will be needed for road transport infrastructure development and some VND119 trillion ($5.24 billion) will be for railway transport. The amount for aviation and marine transports will be VND101 trillion ($4.44 billion) each.
Transport Minister Nguyen Van The expected that more than VND300 trillion ($13.21 billion) of the total will come from the private sector, especially from foreign funds.
Pham Quang Dung, Chairman of the Board of Directors of Tasco Company, said investors expect a legal corridor for PPP investment activities, adding that the law will facilitate the flow of investment into infrastructure system.
Vu Quynh Le, Deputy Director of the MPI’s Bidding Management Department, said if the ministry receives approval from the government, the draft law will be submitted to the National Assembly in 2020 or 2021.
She said that the bill should specify risks in the implementation of PPP on the principle of dividing risks to the party that has the strongest capacity in handling them.
According to the MPI, the bill aims to deal with major issues, including enhancing investment efficiency, investment process and procedures, investment attraction measures and legacy of PPP contracts.
New policies included in the bill are expected to change mindsets in PPP implementation. Accordingly, the most feasible projects will be prioritized for PPP, while the choosing of investors for PPP projects will be more transparent.
Le said that the bill will help build an investment environment for PPP investment with a quality legal framework.
Investment process and procedures will also made to suit characteristics of PPP projects, contract forms and different scales and management levels, prioritizing the reduction of administrative procedures and decentralization.
The draft law is hoped to create a fair playground for State-owned and private enterprises and harmonized interest between the State and investors, while introducing a coherent, transparent, smooth and attractive legal corridor for investment to engage in long-term and risky PPP projects.
