Ministry touts wealth of PPP transport projects

The Ministry of Transport has compiled a list of 50 projects valued at $7.5 billion in which BOT deals are welcome
Photo: Le Toan

Two investors have expressed their interests in collaborating on the construction of the 24-kilometre My Thuan-Can Tho expressway, or dual carriageway that links Ho Chi Minh City and the south west of Vietnam via a build, operate, and transfer model (BOT).

The estimated VND6.2 trillion ($290 million) road is currently undergoing a feasibility study, with the government prepared to offer between VND950 billion-VND1.6 trillion ($44.6-75 million) over a twenty-year profitability schedule.

The Ministry of Transport (MoT) has allowed Sovico-Imico-Pacific-Cienco 5 consortium and Long Thanh Golf Investment and Trading JSC access to the project. The ministry told Cuu Long Corporation for Investment Development and Project Management of Infrastructure – the body responsible for the project – to close bids in the second quarter this year so work can begin in the second half of the year.

“These investors have the financial capacity so the project should be able to be completed on schedule,” Duong Tuan Minh, Cuu Long’s general director said.

The ministry hopes to get several other BOT projects underway, including the highway project, eight road projects and one domestic waterway upgrade project valued at VND22.3 trillion ($1.04 billion), of which investment via the BOT model would total VND21.8 trillion ($1.02 billion).

The ministry has 50 projects valued at $7.5 billion which it believes can be carried out under the BOT format. It envisages the private sector contributing $5.26 billion, with the remaining finance sourced from the government.

The ministry has also announced five air transport infrastructure projects planned to be carried out under the Public-Private Partnership (PPP) format where operational rights can be sold under an operations and maintenance (O&M) contract.

Apart from the Phu Quoc Airport’s piloting of O&M, smaller scale BOT projects include car parks at Noi Bai and Tan Son Nhat international airports.

According to MoT Minister Dinh La Thang, the sale of the operational rights complies with the law, and the government is not going to sell its state management role to the private sector.

The government will obviously carry on all national security and flight management within its air space, with the government only selling operational rights that do not require state involvement.