October 14, 2019 10:49

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Bui Danh Lien, former Chairman of Hanoi Automobile Transport Association: The important issue is the need to resolve the existence of BOT stations

17:31 | 11/07/2019

VCN  - According to Bui Danh Lien (pictured), former Chairman of Hanoi Automobile Transport Association, first of all, it is necessary to solve the existing problems of BOT stations and then take into account the correct collection,, because if the BOT fee is increased, it will affect people and transport businesses.

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Regarding declining revenue compared to the initial financial plan in traffic BOT projects, the Ministry of Transport said one of the main reasons leading to the decline in revenue of BOT projects was due to lower flow than forecast and the reduction of toll rates and the increase in fees according to the roadmap. What do you think?

BOT projects in the past had still too many shortcomings that, according to the assessment, derived from the poor management. One of the typical shortcomings, which is causing prolonged difficulties that until this point have not been resolved yet is the situation that BOT transport projects are not transparent from construction, station set up, fee level, fee collecting time, causing annoyance for people and businesses. At this point, some BOT stations still have complicated "hot" points, even investors have to discharge stations because the drivers focus on protesting and causing traffic congestion. Typically, the Hoa Lac-Hoa Binh BOT toll collection station, although it has just been included in the capital recovery fee, from the beginning of May 2019, it has been continuously discharged.

According to international practice, one of the factors that ensures the success of a BOT project is the publicity and transparency of the project that is respected and fully implemented; since then, creating effective monitoring mechanisms, limiting negative, creating trust for investors and people, especially creating high consensus for the operation of the project later.

The reason given in the draft of the Ministry of Transport should also be clarified, because traffic has been reduced due to the actual amount of vehicles lower than the calculation plan (counting cars). As far as I know, when setting up the financial plan of the project, it is necessary to have the person/unit responsible for forecasting the number of vehicles, the growth of the economy or the competition of too many BOT projects built on the same route. This may make the BOT project's revenue sources unable to meet the approved financial plans, thus the project is not feasible. Therefore, it is necessary to clarify the responsibilities of both parties.

The consequences of unreasonable BOT management policy have been very heavy. First of all is the social instability due to mistakes from placing BOT stations in the wrong place, collecting wrong money but not being thoroughly handled but seeking to kick the ball down the road, pushing responsibility, causing people to be annoyed.

If the people’s interests are not properly considered, they will find ways to circumvent the law and make mistakes such as loading and overloading in order to reduce transportation costs and maintain operations for enterprises. This is the reason that roads are damaged and accidents are high, causing damage to both people and society.

In your opinion, what are the consequences for increasing the fees for BOT projects?

Certainly, increasing the BOT fee will lead to an increase in transportation costs, which will lead to inflation because the production cost in the whole society will increase, making the increase of domestic goods production unable to compete with foreign goods.

People and transport businesses are feeling exhausted because input costs are too high, which is due to the increase in BOT fees. This has a significant impact on the existence and development of enterprises.

The socialisation and development of transport infrastructure in the form of public-private partnerships are considered necessary directions, in the context that the State budget cannot meet demand. However, it is also necessary to look back as some BOT projects are not suitable, leading to the placing of the payback toll station causing a reaction in public opinion. Therefore, the bulk charge of BOT stations even though the term is signed under the contract, but the Ministry of Transport should also consider increasing it properly, avoiding people's bad reactions, causing bad impacts to investors as well as society.

If there is a need to increase fees for BOT projects, what should be done according to the roadmap?

The increase according to the plan for BOT stations is in accordance with regulations. However, it should be collected properly and sufficiently. For BOT stations, there are still some shortcomings in location, but not for increases. Moreover, the increase of dozens of BOT projects at the same time can very easily cause bad reactions, causing implications for society.

I suppose that we should not boost fees for BOT projects where stations are not suitable, causing annoyance for people; BOT projects should renovate and upgrade existing roads or unique roads. With these projects, the Ministry of Transport should work with investors to solve problems that exist at toll booths. There is a need for final settlement of projects, implementation of automatic toll collection, effective toll collection monitoring, and then issue higher charges. That way, the public will agree.

When the above issues have not been resolved, it is advisable to only raise fees with completely new BOT projects, not unique (according to Resolution 437/2017 of the Standing Committee of the National Assembly). At the same time, it is necessary to clarify the reason for the fee collection not reaching the financial plan is due to the low volume of vehicles or because the station's regular costs are too big or the organisation is not reasonable. Especially, when the economy grows and vehicles increase, the fees should be reduced to a reasonable new level.

To increase the fee for dozens of existing BOT stations which are due, it is impossible, but it is necessary to clarify which specific responsibilities belong to which, in which BOT businesses must also bear some risk of vehicle traffic. Especially, when BOT hotspots have not cooled down, each specific project should be considered on the basis of transparent revenue sources. Meanwhile, investors of BOT projects are facing huge interest rates from banks, if the fee increase is not implemented, it may cause enterprises to go bankrupt.

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Besides, it is also necessary to consider putting this issue in the context that the development of transport infrastructure in Vietnam has a huge shortage of capital and is in desperate need of private investors. Therefore, if not handle the traffic BOT problem well, in the future, especially in calling for investment in the North-South expressway project in the future, there will be quite a lot of concerns from businesses.

Thank you Sir!

By Tuan Phong/ Huu Tuc