April 07, 2020 00:01

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Remove "bottlenecks" to create momentum for traffic projects

20:38 | 27/01/2020

VCN - 2019 was considered to be a year in which the transport industry made many achievements, when reviewing and focusing on providing many solutions to solve existing "bottlenecks" of traffic projects. In addition, key national transport projects such as the North-South Expressway in the East, Long Thanh International Airport, Tan Son Nhat International Airport expansion, and a pre-feasibility study on the North - South high speed railhave been also accelerated by the Ministry of Transport.

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"Revolution" is groundbreaking

A notable highlight in 2019 of the Ministry of Transport is the decision to cancel the prequalification result in the form of open international bidding for eight projects of the North-South Expressway Project. It isthe first time a national key project, after a period of conducting prequalification to select investors in the form of international bidding, has been canceled by the Ministry of Transport because the number of investors passing aprequalification is low and the competitiveness is not high.

Evaluating this decision of the Ministry of Transport, speakingwith Customs Newspaper, Associate Professor, Dr. Tran Chung, Chairman of Vietnam Association of Road Traffic Investors, said that the above decision of the Ministry Transport was a wise one, making conditions for reputable domestic and capable investors to participate in the bidding. This was considered a golden opportunity to promote the internal strength of domestic investors because the capacity and construction techniques of domestic investors could fully implement the requirements of the project.

In addition to the North-South expressway project, a series of other key national transport projects are also being accelerated by the Ministry of Transport, such as Long Thanh International Airport and Tan Son NhatInternational Airport and a pre-feasibility study ofthe North-South high-speed railway.

In addition to accelerating the progress of key projects, in the past year, the Ministry of Transport has focused on reviewing and handling the "bottlenecks" of BOT stations. The inspection and evaluation results have shown a number of shortcomings and limitations in the process of organizing the implementation of transport projects,such as the control of investment costs; errors in the process of appraising and approving the total investment; many projects have applied the form of contractor appointment (leading to limited competition, public doubts about transparency); the location of the charging station, the collection policieswere inadequate leading to the "wave" of the people's reaction.

Proactive transparency

Minister of Transport Nguyen Van The also acknowledged that the implementation process of BOT transport projects was still limitedand inadequate. Therefore, in recent years, to solve the inadequacies, after reviewing all projects that had been and were going to be implemented under the BOT form, the Ministry of Transport had stopped four projectssigningcontracts and ongoing; stopped eight road projectsapproved proposals orpreparingfeasibility studies. Currently, only calling for BOT investmentimplemented in eight North-South Expressway sections in the East in the 2017-2020 period.

In addition, the Ministry of Transport has also coordinated with ministries, branches, localities and investors to adjust the position of some charging stations with inadequacies; fee exemption or reduction; direct investors to disclose project information at the charging stations (total investment, time of charge).

Another noteworthy highlight in the past year is that the Ministry of Transport had actively invited the State Audit of Vietnam (SAV) to audit all projects (67 audits were carried out in 60 BOT and BT transportation projects). Strictly complying with the conclusion of the SAV, the inspection with outstanding issues, especially on financial handling, handling of responsibilities and settlement of investment costs.

With proactive review of inadequacies and synchronous implementation of solutions, inadequacies at BOT charging stations have basically been solved, including projects on the main line and bypasses.

According to experts, the policy ofcalling for private capital intransport infrastructure is necessary and proper, however, PPP contractsshould be issued with a separate policy framework for special projects.

Chairman of the Vietnam Association of Road Traffic Investors said that the most positive impact of PPP was opening up opportunities and conditions for mobilizingcapitalfrom theprivate sector to invest in infrastructure, reducing the burden on the State budget.

Through a survey of 12 road transport infrastructure projects across the country, from Can Tho to Quang Ninh, including 10 investment projects applying PPP,we found that the first problem mentioned by investors was theinstitution. This was the biggest concern of PPP investors, namely the principle of cost management and capital management.

“In order to resolve the bottlenecks of PPP transport project, the Law on Investment in the form of public-private partnership - PPP willsolve many obstacles, such as the State's commitment onrisk,most public-private partnership investment projects showed benefit sharing between the state and the private sector. In the past, the Ministry of Transport has been very active and proactive in acknowledgingcommentsas well as contributing ideas to develop a complete PPP Law. On behalf of the investors of the road traffic project, I hope the PPP Law will come to life soon,”Mr. Trang stated.

According to Assoc. Prof. Dr. Tran DinhThien, former Director of Vietnam Economic Institute, transport infrastructure projects must be strategic breakthroughs, in which PPP projects were considered to be "breakthroughs in breakthroughs" for the implementation method and institutions. However, the reality of our policy environment and legal system was highly unstable.We try to make laws in the sense of coping and loosening upwhile the old foundation was in a lot of conflict. He proposed to the Government to change this mindset, otherwise any investor could survive this constant policy shift. Investor confidence would break. He thought we should have separate policy frameworks for special projects.

“Particularly for BOT projects, I think that theymust be considered national ones and we must encourage the winners, not choose the winners. If any unit commits to quality and responsibility, the State must support it, including the guarantee of capital for investors to borrow from banks. In my opinion, for large infrastructure projects, the Government must consider them as an opportunity for Vietnamese enterprises to grow. The fact is that domestic enterprises are not respected and tied down badly, while foreign enterprises are created too much conditions even though their capacities are not much better than ours. So, I think we must have a clear intention to encourage domestic enterprises to grow,”Mr. Tran DinhThien suggested.

By Xuan Thao/ Binh Minh