Out-Law News | 20 Jan 2021 | 3:56 am |
Vietnam has changed the status of two road building projects, making them public projects after failing to find investors for the work as a public private partnership (PPP).
Vietnam’s National Assembly Standing Committee (NASC) changed the status of two north-south expressway component projects from PPP to a publicly funded project after failing to find investors by biddings.
The two sections are National Highway No.45-Nghi Son and Nghi Son-Dienn Chau.
The north-south expressway project includes 11 sub-projects with a total length of 654 kilometres running through 13 provinces and cities. The total investment is VND118 trillion ($5.04 billion).
According to the Vietnam Association of Road Traffic Investors (VARSI) chairman Tran Chung, infrastructure projects normally would require large amounts of capital that can only be recouped slowly. Banks tend to be hesitant to lend such large amounts due to long repayment time.
National Assembly passed a new law on PPP investment in June 2020 and will be effective from 21 January to allow government to share financial risks with private firms. It is expected to attract more investment from private firms in infrastructure.