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PPP Framework to Boost Private Investment for Vietnam Infrastructure Projects

A pilot public-private partnership (PPP) legal framework, approved by the Vietnamese government last week, will bolster up private investment in local infrastructure sector.

The issuance of the PPP legal framework will allow private investors, especially foreign investors, to push their infrastructure investment plans in Vietnam, said Dang Huy Dong, Deputy Minister of Planning and Investment.

The U.S.-based Airis Holding LLC rushed to preparation for two PPP projects at Noi Bai and Danang international airports in Vietnam after the promulgation of the legal framework.

The company will sign two memorandums of understanding for those projects under PPP form and it is very keen on pilot PPP projects, Nguyen Trong Nguyen, chief representative of Airis Holding LLC in Vietnam said.

The newly-approved legal framework, providing for the state to form partnerships with private investors, will help the Vietnamese government and businesses to reduce risks for their infrastructure projects.

A source from the Department of Transport Infrastructure under the Ministry of Transport disclosed that Japan’s Nexco Central is also eyeing PPP projects in Vietnam northern region.

Last July, Vietnam allowed domestic private firm Bitexco Group and IFC, World Bank Group’s financial arm, to become investors for the Dau Giay-Phan Thiet expressway in PPP form.

Meanwhile, Bao Viet Trung, director at Vietnam Expressway Corporation Service Joint Stock Company, said this regulation will push domestic private investors away from PPP projects because they cannot mobilize huge funds without government guarantees.

Vietnam needs about $170 billion for developing infrastructure during next 10 years, of which about half is expected to come from the private sector, according to the Ministry of Planning and Investment (MPI). (VIR)

Source: Vietnam Business Forum