Cargo containers are loaded from ships at Tien Sa Port in the central city of Da Nang. The country is putting in major efforts to innovate public investment in infrastructure development, by shifting from heavy reliance on the dwindling State budget to mobilisation of private resources. — VNA/VNS Photo Le Lam

HA NOI (Biz Hub) — The Ministry of Planning and Investment (MPI) is eying to expand the categories of the much-vaunted Public-Private Partnership (PPP) model of investment.

In an attempt to fix any loopholes in the legal framework and lack of efficiency in previous policies, MPI is on its way to draft a new policy for synchronising and updating investment policies.

The new decree will replace Decree No 108/2009/ND-CP and Decree No 24/2011/ND-CP on Build-Operate-Transfer (BOT) contracts and Build-Transfer (BT) and dismiss Decree No71/2010/QD-TTg on pilot investment in the PPP.

In the draft that aims to mobilise more civil capital and ease overloading in certain sectors, the ministry has rewritten regulations related to the State's participation in PPP projects. The assessment and disbursement of the state capital under PPP will strictly follow the regulations of using state capital and state assets that are allocated for development.

The draft allows more areas of work under PPP, including urban transport infrastructure, port and logistics, waterway constructions, and energy production. Also included are information and communications infrastructure, infrastructure for economic and industrial zones, rural and agriculture, and commerce. Housing, resettlement, and public services will also be added.

The ministry plans to build the new policy on par with what is followed at the international level.

In fact, the lack of a comprehensive legal framework for PPP, the Government's lack of experience and shortage of funds are major obstacles, which have prevented investors, especially foreigners, from taking part in PPP projects in Viet Nam.

Viet Nam has become a middle-income country but faced a barrier that few countries did, which is the practice of relying heavily on the State budget that diverted the nation's focus from co-operating with private partners in infrastructure projects.

While the country needs about US$15-16 billion each year for infrastructure development, public spending can only provide about 50-60 per cent of the required funds.

The country is putting in major efforts to innovate public investment in infrastructure development, by shifting from heavy reliance on the dwindling State budget to mobilisation of private resources.

However, it is clear that Viet Nam's investment environment had many limitations including bureaucracy, cumbersome administrative procedures, and instable policies. —VNS