PPP in vogue for Japanese

Japanese investors are interested in infrastructure projects underway under public-private investment form (PPP) in Vietnam, particularly in Hanoi and Ho Chi Minh City, according to former Japanese ambassador to Vietnam  and now deputy chairman of Saigon Invest Group (SGI) Norio Hattori.

“The Vietnamese government needs to draw model contracts for each PPP project for firms to take as reference. Besides, Vietnam should resort to support from prestigious foreign consultants in appraising project feasibility, investment cost, capital recouping capacity and risk possibilities during implementation to make projects more appealing to investors,” said Hattori.

In fact, a lack of relative information about PPP project feasibility, responsibility sharing scheme between investors and Vietnamese government and relevant laws in case of disputes are now prime concerns of investors.

“Currently, implementation of PPP projects follows prime ministerial Decision 71/2010/QD-TTg and contract terms to harmonise investor and Vietnamese state interests,” said Ministry of Planning and Investment (MPI) Foreign Investment Agency deputy general director Dang Xuan Quang.

Quang said Vietnam would appreciate attention from international investors, including Japanese investors, in current stage of PPP project pilot implementation and consolidating relevant legal framework.

“Vietnam will exercise policies to bring comfort to PPP project investors, starting from widespread information disclosure,” Quang said.

The MPI reportedly submitted and is awaiting government approval for five key infrastructure projects to get rolling under PPP form. These are Ho Chi Minh City’s Nhieu Loc-Thi Nghe elevated road 1, Song Hau water plant in Mekong Delta Can Tho city, and three expressway projects between Halong-Haiphong, Ninh Binh-Thanh Hoa and Nghi Son-Bai Vot.

Of the above-said projects, elevated road 1 is of special importance to Ho Chi Minh City’s transport network.
The projected 10.8 kilometre, four-lane road starts from Tan Son Nhat international airport in the city’s northwest.

“With estimated traffic volume of 220,000 vehicles/year, the project promises quick capital recouping via toll collection,” said Ho Chi Minh City Transport Department’s planning and investment section head Nguyen Huu Chanh.

The project involves 60,000sqm and costs around $720 million in total investment capital based on 2007-2008 estimates.