HCM CITY (VNS) — With public spending on infrastructure development proving insufficient, the Ministry of Transport is seeking to attract private investment.
|Workers on a construction site to extend a stretch of National Highway No 1A in the central province of Ha Tinh. — VNA/VNS Photo Trong Dat
According to the ministry's Planning and Investment Department, transport infrastructure is not well developed, affecting the country's socio-economic development.
In big cities, incompetent infrastructure planning and slow site clearance are blamed for creating many traffic bottlenecks.
The transport sector faces a shortage of capital for infrastructure development in 2014–20 estimated at VND960 trillion (about US$45.7 billion).
Capital from the State budget is estimated at VND70 trillion and VND110 trillion ($3.3 billion-$5.2 billion) from the Government's bonds, plus VND100 trillion ($4.7 billion) from foreign investment sources. Thus, an additional investment of VND680 trillion ($32.3 billion) is needed for infrastructure development.
In this scenario, private investment becomes important.
Le Anh Tuan, head of the ministry's PPP (Private-Public Partnership) projects management unit, said the ministry has rolled out the "red carpet" to private investors for a number of projects in BOT (build-operate-transfer), BT (build-transfer), and PPP modes to be completed by 2016.
According to Nguyen Hoang, head of the ministry's Planning and Investment Department, in 2011-13, the ministry had mobilised nearly VND90 trillion ($4.2 billion) from private sources for major transport projects. The figure included VND43.7 trillion ($2.1 billion) for BOT projects to expand National Highway No 1A, nearly VND6 trillion ($286 million) for BOT projects to expand National Highway No 14, and nearly VND40 trillion ($1.9 billion) for other projects.
The ministry will continue to seek private investment for aviation, rail, and waterway projects and hold auctions for the purpose. — VNS