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Official Gazette

Saturday, September 19, 2020

Public investment projects may take PPP form

Updated: 08:00’ - 05/08/2015
Public investment projects using state budget funds or government bonds will likely be allowed to be implemented in the form of public-private partnership (PPP).
Quang Ninh starts a PPP project of building its welcome gate and stopover__Nguyen Hoang/VNA   

According to a Ministry of Planning and Investment-drafted circular guiding the PPP Decree No. 15 issued in February this year, a public investment project to build, renovate or commercially operate infrastructure facilities, supply equipment or provide public services might be transformed into a PPP one.
However, in addition to the conditions set in the PPP decree, the project must satisfy some other requirements. Firstly, the project must show prospects for investment capital recovery. Secondly, the project owner must have available land for allocation to investors as payment for the project or the project could be transferred to a domestic or foreign investor for continued implementation.
The draft goes on to stipulate the form of BOT contract or another similar contract form would apply if the project shows possibilities for capital recovery and profitability once assigned to a private investor.  Meanwhile, the form of BT contract would apply in case the ministry, sector or local administration being the project owner may arrange and allocate land to the investor for implementation of another commercial project as part of the PPP arrangement. In both cases, the project owner will either withdraw the whole state capital amount already invested in the project or use it for further implementation of the project.
Experts believe that together with other PPP regulations, the draft circular, once approved, would be a step forward in promoting the PPP model in the country and reducing burdens on the state budget in development investment.- (VLLF)

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