According to the Ministry of Finance, the transport and urban infrastructure sectors alone will require around 245 billion USD over the next five years - a massive sum compared to the government’s fiscal capacity.

The question is no longer whether the public or private sector should lead investment efforts, but rather how to design effective, transparent, and sustainable mechanisms to mobilize all available resources.

Within that framework, the public-private partnership (PPP) model is re-emerging with a broader mandate. In the Philippines, for instance, the renovation of NAIA International Airport drew 123 billion pesos (around 55 trillion VND) from private investors, raising its capacity to 62 million passengers annually and modernizing the country’s airport network.

Vietnam also has its own success story: the e-GP project - a BOT contract between the Ministry of Planning and Investment and FPT IS - has fully replaced the old national bidding platform since 2022. Under the arrangement, the state handles planning and oversight, while the private partner operates the service and takes responsibility for its quality and timeline.

This demonstrates that the PPP model is not limited to physical infrastructure - it can also apply to high-tech and essential public services.

At the recent PPP Dialogue Program in Vietnam on November 25, Deputy Minister of Finance Tran Quoc Phuong announced three priority sectors for PPP collaboration in the near future. Leading the list, as expected, is transportation - a foundational pillar of national development.

Delays in critical projects caused by public spending limits can no longer be tolerated. In this context, PPP is not just a tool for sharing risk and attracting private capital - it is a strategic mechanism to ensure infrastructure leads development, rather than reacting to it.

Transit-oriented urban development and PPP financing

In major cities, the issue has taken on new dimensions. Transit-oriented development (TOD) - the integration of urban growth with public transportation - is becoming a key concept.

Experts, especially from South Korea, emphasized a proven lesson: the value of land surrounding metro lines can be reinvested into public transport systems, creating a self-sustaining financial cycle.

As Vietnam considers the North–South high-speed railway and metro systems in Hanoi and Ho Chi Minh City, TOD is no longer just a planning concept - it has become a required financial component of project design.

Building urban railways or high-speed rail sustainably requires one fundamental question to be answered first: where will the capital come from?

Innovation and digital infrastructure as new frontiers for PPP

The third focus area is innovation and digital infrastructure. Vietnam has begun crafting strong incentive policies: PPP investors in science and technology are exempt from sharing revenue increases for the first three years, and receive support if revenues fall below financial forecasts.

These policy signals reflect a shift in PPP thinking - moving beyond roads, ports, and airports into sectors where the private sector holds technological advantages, resources, and creative capacity.

The challenge: PPP needs more than legal frameworks

More importantly, recent discussions have acknowledged a critical truth: legal frameworks alone are not enough for PPPs to succeed.

Key obstacles lie in project design, credit mobilization, risk guarantee mechanisms, and separating PPP credit from commercial lending.

Shantanu Chakraborty, Country Director of the Asian Development Bank in Vietnam, stated at the PPP Dialogue: “Institutional reform ambitions must translate into projects that are truly viable in the market.”

A PPP project can only stand firm if it is both financially viable and meets international credit standards. Without capital flows, even the best concepts remain paper ideas.

15 years of legal groundwork - and now, the test of delivery

Vietnam’s PPP journey is not new. The legal framework has been under development for over 15 years - from Decree 108 (2009), Decision 71 (2010), Decree 15 (2015), Decree 63 (2018), to the Law on Investment under the Public-Private Partnership Method (2020), and new amendments currently in the works.

This shows the state’s progression from experimentation to building a stable system capable of earning investor confidence.

As Vietnam prepares to embark on the largest infrastructure projects in its history - from high-speed rail and metros to ports, airports, and digital infrastructure - PPP is more than a financing tool.

It is a mechanism that allows the state to guide development, while enterprises bring in execution capacity. This public-private synergy is the model many nations have adopted to close infrastructure gaps and enhance competitiveness.

If national development is a journey toward modern standards, then using PPP correctly means the state leads, enterprises participate, and society benefits from a synchronized, sustainable, and future-ready infrastructure ecosystem.

 
Lan Anh