VietNamNet Bridge – Local tech firms are unsure about investing in private public projects (PPP) due to the lack of concrete guidance for their implementation in the ICT sector.

Too many procedures and formalities are also proving an obstacle for enterprises.

According to Nguyen Thanh Phuc, Head of the Information Technology Application Department under the Ministry of Information and Communication, under the national programme to apply IT in state agencies during the 2011-2015 period, 56 projects in information infrastructure needed to be implemented.

Lack of capital had also hampered the progress of these projects, with the State budget only able to satisfy 10 per cent of the costs, Phuc added.

Phuc said four projects had been completed, 11 were under investment, and nine that had received approval were yet to start.

The other 26 projects were in the preparatory steps for investment, while six were looking for alternatives to their initial investment sources.

PPP has been cited as the most effective solution to the lack of capital. The mechanism has particular importance at the moment, with the State tightening public investments in an effort to control inflation.

Ho Chi Dung, a senior executive of Viettel, said Viet Nam should learn from Singapore.

PPP models in Singapore save 15 per cent of total expenses, reduce the implementation duration by 15 per cent, cut design expenses by 30 per cent, and shave 15 per cent off the costs of construction and operation.

However, no meaningful progress has been made since State officials and IT firms agreed that PPP was the most suitable mechanism for IT projects.

Dung said there was no concrete guidance for the implementation of PPPs in information technology and communications, so despite their advantages, Viet Nam had failed to utilise them on a larger scale.

In November 2010, the Prime Minister released Decision No. 71 on the implementation of investment projects under the PPP model.

However, the list of the fields which could apply the PPP mechanism stipulated in the decision did not include information and communications technology.

To date, only one IT project has been untaken under the PPP model.

Analysts believe that IT firms needed to be reassured about the benefits of the PPP mechanism.
The Ministry of Information and Communications must take responsibility for building a comprehensive legal framework on the issue.

Tran Tuong Lan, a senior official from the Ministry of Planning and Investment, suggested that the Ministry of Information and Communications should make a report on the current situation and the readiness of IT enterprises for PPPs, and form research teams to support their preparation and implementation.

Source: VNS