PPP projects await private investors: ministry

Dang Xuan Quang, deputy director of the ministry’s Foreign Investment Agency, said the 24 PPP projects required total investment capital of US$20 billion, but authorities would sort out some projects only for the trial scheme of promoting PPP projects.

The Government will launch these PPP projects on a trial basis within a short period of three to five years, and in its preparations, the Government will conduct international tenders to choose consultants and investors for these projects, Quang told the Southeast Asia Private Equity Conference.

Vietnam is in dire need of private investments and the participation of private firms in large-scale projects, he said.

"The Government wants to tap the huge private capital resource,” he said.

Quang explained that the country needs at least US$160-180 billion for basic infrastructure, half of which should come from the private sector.

There will be an important shift in Vietnam’s investment structure in the near future, making it more sustainable and less dependent on traditional capital sources such as official development assistance (ODA) or government bonds. A strong cut in public investments is therefore needed, Quang said.

Answering investors’ questions on the falling foreign direct investment (FDI) flow in the country, Quang said the quality should prevail over quantity.

"This year’s FDI flow has reached US$9.9 billion, while FDI disbursement has totaled US$8.2 billion to date, and we will try to attract good FDI projects instead of counting on many projects,” said Quang.

"I think two issues that the Government will focus on in the future are how to attract private investments into infrastructure and develop the supporting industry."

Private investors and regional investment funds at the conference all expected that forthcoming PPP projects should be commercially viable, and that there is a solid foundation for the State and the private sector to cooperate in the long term.

Jonathan Pincus, a well-known economist at the Fulbright Economic Teaching Program, suggested that there must be harmony in ensuring benefits for both the State and the private sector.

"The interest must be balanced," he said.