VietNamNet Bridge – Vietnamese construction companies, which always complain that they cannot win the bids due to the small operation scale, will have bigger opportunities to obtain more contracts, once the Bidding Law takes effects on July 1, 2014.

According to Le Van Tang, Head of the Procurement Management Department, an arm of the Ministry of Planning and Investment, the new law would pave the way for small enterprises to win the bids for the projects that fit their capability.

With the current laws, big corporations always have advantages over small ones to win the bids. However, after obtaining the contracts, the big corporations would outsource the works to small companies.

As such, though small companies have to work hard, they cannot make the profits satisfactory enough, because the money goes to the pockets of the big corporations.

Therefore, Tang said, the new law stipulates that the priority will be given to small enterprises when looking for the contractors for small projects. The enterprises of which 25 percent are female workers, disables or wounded soldiers, can also enjoy preferences when joining the domestic bids for providing consultancy, non-consultancy, construction and installation services.

The new law is believed to make a “revolution” in the bidding mechanism, as it would allow to choose the most technically capable contractors instead of the contractors who offer low prices but don’t have enough experiences.

Experts many times warned that the current bidding law, which stipulates that the contractors offering the lowest prices will be the winners, is the reason behind the low-quality construction works.

Telecom groups, for example, when criticized for using telecom equipments provided by Chinese Huawei and ZTE despite the high security risks, explained that the current bidding mechanism forces them to choose Chinese suppliers.

“We have to choose Huawei’s or ZTE’s products. If we don’t, we will violate the current bidding mechanism, which stipulates that the contractors to be chosen must be the ones who offer the lowest prices,” manager of a telco said.

The experts also pointed out that the projects implemented by Chinese contractors usually have troubles because of the backward cheap technologies used by the contractors.

Under the new bidding mechanism, investors would consider the technical capability of the contractors first, while they would only consider the offered financial solutions after they find the contractors technically capable enough.

Tran Hoang Ngan, a Member of the National Assembly’s Economics Committee, said he highly appreciates the new law because it would allow to encourage the domestic production.

Contractors would be able to enjoy preferences if they join the domestic or international bids for supplying the goods which have the domestic production cost accounting for 25 percent or more of the total production costs.

Hong Sun, Secretary General of the South Korean Enterprises’ Association in Vietnam, commented that no obstacle would appear before South Korean enterprises when the new law takes effects.

He said that even if Vietnamese enterprises can get the support from the government, they would also have to upgrade themselves to be competitive in the bidding.

DDDN