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Private money sought for infrastructure

Update: September, 05/2013 - 09:34
Phu My Bridge was built under the BOT form.— Photo sggp

HCM CITY (VNS)— City authorities are giving priority for investments from the private sector, especially investments under the Public - Private Partnership (PPP) mode, for infrastructure development.

The announcement was made at a PPP seminar held by the HCM City Department of Planning and Investment on Tuesday.

According to Nguyen Thi Hong, deputy chairwoman of the HCM City People's Committee, the city has a plan to call for BOT (Build - Operate - Transfer) and BT (Build - Transfer) investments for 42 infrastructure projects that require capital of more than VND158 trillion (nearly US$7.5 billion) in total.

Between 2004 and 2012, the city mobilised capital for 25 BOT, BT and BOO (Build - Operate - Own) projects, amounting to a total of VND74 trillion ($3.5 billion).

These include the Phu My Bridge, which was built under the BOT form, and the Thu Duc Water Supply Plant, a BOO project, according to Hong.

Investments from the city budget accounts for 12 per cent of total investment for infrastructure projects, much lower than the 20 per cent of previous years.

"It indicates that the city authority has taken greater effort to mobilise capital [for these infrastructure projects] from the private sectors," Hong was quoted as saying in Tuoi Tre (Youth) newspaper.

The Agence Francaise Devellopement (AFD) and the World Bank have both provided loans to the private sector for these infrastructure development projects.

AFD's loans were provided to social welfare projects, such as hospitals, while the World Bank has focused on loans for infrastructure projects, she said.

HCM City has also submitted to the Ministry of Planning and Investment a list of six infrastructure projects calling for PPP investments to be approved by the Government.

These projects, mainly in infrastructure development and reduction of clean water losses, were capitalised at VND13.8 trillion ($654 million).

To better manage the PPP investment mode, HCM City has established a work team, aiming to promote PPP by enhancing the "one-stop" mechanism for this investment mode. — VNS

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