HCMC will have to search for more capital from the private sector as its budget can only meet 20% of the demand which is estimated at VND850 trillion (US$37.5 billion) in the 2016-2020 period, said the city government leader.

Nguyen Thanh Phong, chairman of the HCMC People’s Committee, speaks at a conference on June 14

HCMC People’s Committee chairman Nguyen Thanh Phong, speaking at a conference on infrastructure investment on June 14, said three key sectors – traffic infrastructure, environmental protection and flood control – would require a total of nearly VND500 trillion.

Public-private partnership (PPP) will be an investment format of choice when it comes to developing big-ticket infrastructure projects in the city as the city government alone cannot afford to finance them.

According to Government Decree 15/2015/ND-CP dated February 14, 2015, PPP comes in the forms of build-operate-transfer (BOT), build-transfer-operate (BTO), build-transfer (BT), build-own-operate (BOO), build-transfer-lease (BTL), build-lease-transfer (BLT) and operate-manage (O&M).

The Department of Planning and Investment cautioned that a lack of land in exchange for BT investors, complicated procedures and site clearance difficulties might make PPP unattractive.

Chairman Phong suggested the department publicize all PPP projects that need investment or public projects that would be converted into PPP ones on its website so that investors could learn about them. “New measures are expected to come out to prop up PPP for the development of the city.”

The city has 23 PPP projects signed and finished with a total investment of about VND71.2 trillion. There are other 130 PPP projects under preparation with a total cost of an estimated VND381 trillion, covering sectors such as traffic infrastructure, environmental protection, healthcare, education, culture, sport, trade and services.

Vo Khac Thai, chairman of the People’s Committee of District 3, said the district has implemented many PPP projects worth about VND10 trillion, thus helping ease the financial burden.

Some participants at the conference said the central Government should guarantee the stability of PPP policy as ad hoc legal changes can put investors’ interests at stake.

Thai said it now takes more than four months for a PPP project to complete all investment procedures. Investors have suggested shortening the time to one month only.

Vu Quynh Le, deputy director of the Public Procurement Agency under the Ministry of Planning and Investment, said the agency has proposed amending Decree 15/2015/ND-CP and Decree 30/2015/ND-CP in a way that rolls out more incentives for PPP projects.

SGT