Regulations on PPP contracts in Vietnam: Status Quos and Solutions

2010

During my graduation research for MSc studies, I was assisted by my graduation committee. I would like to express my sincere thanks and most profound gratitude to my supervisor, Prof. drs.ir. J. K. Vrijling, who provided constructive advices, valuable guidance and comments from the very beginning until the completion of this research. This research would not have been completed without his strong commitment in those tasks and his preliminary editorial work on this thesis draft. I wish to express my grateful gratitude and great appreciation to my advisor, Associate prof. dr. Joop Koppenjan for his dedications and expertise's support to my study. He gave his valuable and constructive comments, suggestions and discussions to improve the quality of this research. Special thanks and gratitude are addressed to dr. Jules Verlaan for his warm helps in this thesis and during the two-year master in Delft. He provided me with many physical and mental supports during the student life in Delft. I highly appreciate for his help. Besides, I would like to express my thanks to Mr. Oach Huu Nghia in providing precious knowledge, data in PPP projects, which play an important role in fulfilling my thesis. Finally, I would like to gratefully acknowledge my scholarship sponsor, Can Tho 150 Project of Mekong 1000 program in Vietnam, in funding for my two-year studying. Tang Quoc Cuong June 2010 Delft, The Netherlands v in Vietnam, many crucial risks, stakeholders' perspectives and risk management practice in Vietnam are presented. The author figured out that almost BOT projects in Vietnam have not allocated risks properly and systematically that usually lead to conflicts and even failures of project. Therefore, developing a practical risk management framework is the most important strategy for improving performance of PPP projects in Vietnam nowadays. The fourth part explores policy and legal aspect of PPP model and investigates the policy and legal regime of BOT project environment in Vietnam to figure out what are the problems in it and find ways to improve them. This part presents the guided actions to build up a good institutional policy and legal framework that governments should do for PPP model to create incentives and guarantees for private participation in PPP projects. The policy framework should have clear objectives and principles, realistic targets, while the legal framework should be fewer, simpler and better in order to make the private sector to be secured and confident. Moreover, a good institutional policy and legal framework should take into account all the stakeholders involved and guarantee them access in decision-making while preparing for the development of PPP projects. The role of government is to create a favorable investment environment by creating a willingness to invest from the private investors, establishing a good design of contract, and preventing regulation from failure in infrastructure project, and offering government guarantees and incentives to support the private investors participating in PPP projects. Such principles of good project governance can be the basis theoretical notions for the government to practice for improving the performance of PPP projects. BOT Decree in Vietnam fails to address adequately many of the issues necessary for practicing PPP model to be successful. Thus, it needs to be improved. The fifth part of this research introduces readers about the status of infrastructure development in Vietnam and the reasons for failures, inadequacies in previous BOT projects. The author recognizes that transportation sector, electricity sector, water and sanitation sector, and telecommunication sectors in infrastructure of Vietnam are still underdeveloped and in an urgent need of improvement against an increasing high demand. They face many problems such as shortage of capital for investment, lack of technical experts, weak management skills, high risk and uncertainty, etc. In such cases, private sector participation is expected to play a major role in providing the sufficient capital for ever-hungry-capital infrastructure in Vietnam. However, practicing of BOT projects in Vietnam has faced many difficulties reducing the willingness of investors for participating. The problems are the nascent and immature financial market; the domination of State-Owned Enterprises; lack of transparency project selection, bidding and negotiation processes; weak risk management skills; poor capacity of government agencies to manage BOT projects, etc. Due to many inherent risks and uncertainties in BOT projects in Vietnam, such projects often face with massive price escalation and low revenue to recoup the project cost and serve the debt service. Therefore, some suggestions for improvement are provided in this part. The case study in this part shows some important risks commonly faced by this project in specific as well as by BOT projects in Vietnam in general. They are delaying in land acquisition risk, delay in approval risk, risk of transportation network in adjacent region, cost overrun, improper analysis of concession duration, corruption risk, foreign currency exchange risk and political risk. Lastly, it is seem that fairness, transparency, sustainability, effectiveness and efficiency are hardly to obtain in environment of BOT project in Vietnam due to both the subjective and objective reasons. vi TABLE OF CONTENTS: Chapter 1. Introduction and research scope ..

Concession is one of the forms of public-private partnership. Financial sources, on the other hand, for many public-private partnership projects are generated by private investment. Both concession and investment play a significant role within the public-private partnership. Analysis of the Law of Georgia on Concession with relevant laws of the other countries clearly underlies that institutional and legal mechanism of concession relations in Georgia do not comply with the best international standards established in many other countries. Law of Georgia on Investment also contains certain shortcomings in that respect. Therefore, it is necessary to improve and further develop private law norms of concession and investment in order to create those institutional and private law basis which are vital for implementation of public-private partnership. Introduction National legal mechanisms play a significant role in implementation of public-private partnership projects. National and private law norms are vital for successful realization of partnership between public and private sector and finalization of relevant projects. In this paper, we will discuss and analyze private law norms on concession and investments. Concession is one of the forms of public-private partnership. Financial sources for many public-private partnership projects are generated by private investment. Therefore, concession and investments play a significant role in implementation of relevant public-private partnership projects.

Asia Pacific Journal of Public Administration, 2017

Public-private partnerships have been formally provided for in Indonesia since 1998. A comprehensive legal framework has been established by the government concerning possible PPP projects, but to-date only five projects have been approved and only one of them has been completed. The many components of the framework need to be understood by those responsible for researching and advising on possible projects, just as other researchers could find it insightful to explore the reasons for the limited project action within the framework, as well as the focus, form and results of the only completed project. In accordance with these research needs and possibilities, this note addresses the fundamentals of the framework and some significant associated challenges.

2018

Myanmar needs various infrastructure investments in several sectors including power generation & transmission for long-term development and growth. Various investors have proposed many projects with different quality and different standards. The uncertainty is whether the chosen project is a good deal or not. Because of those challenges, the project owners/the investors cannot manage the project-process properly. In any project in Myanmar, there are various risks which can affect the return on investment. Without taking the risks by Government, a low developing country, Myanmar will not be a nice place to do business and the competitive level in attracting investment will not be increased among the regional-countries too. In certain cases of PPP, the Government of Myanmar should contribute the best support through the Guarantee of Government to get more confidence in both sides. However, the systematic checks should be done among the proposed projects, before issuing the guarantees.

In the Philippines, Local Government Units (LGUs) are working to change the administration and functioning of public markets, and the study looked at how well these LGUs were internalizing the basic ideals of New Public administration (NPM). The study evaluated the effectiveness of PPP/BOT Public Markets in resolving the enduring issues with public markets in the Philippines using Public Private Partnership (PPP) as a framework of NPM for infrastructure development and service delivery. It questioned whether PPP had made public markets run more efficiently as a reform tool. Five of the nation's first PPP public markets, including the Mandaluyong Public Market in Mandaluyong City, the Carmen and Cogon Public Markets in Cagayan de Oro City, the Suki Market in Quezon City, and the Bocaue Public Market in Bocaue, Bulacan, were reviewed to support the evaluation. As performance indicators, it looked at management and organization, the range of facilities and services, LGU revenue income and expenditures, vendor income from the market, and client satisfaction with the caliber of the facilities and services. Case studies, content analyses, ocular inspections, and interviews with city and municipal administrators, market administrators, market vendors, and officials of market vendors organizations were some of the combined research approaches used to gather the study's data. The study shows that while PPP has improved the performance of public markets during the early years of operation, these gains and all advances were not sustained by the LGUs when management and operation of public markets were turned over to them from the private project proponent-operators. The study argued that to sustain public-private partnerships in the operation of the public market, it is imperative to institutionalize reforms in the structure, processes, mindsets of the leaders, and stakeholders. The institutionalization of NPM's core values can be carried out effectively through localization of PPP as a policy so that the necessary legal and institutional frameworks for PPP will be anchored based on the need, strength, and weaknesses of the LGU concerned.

International Journal of Business and Management

Public Private Partnership (PPP) is not a new method of development in a country. In Malaysia, concept of PPP had been used almost four decades after Malaysian Incorporated Policy had been introduced by the government. The objectives of this present study is to scrutinize defining the concept of PPP, the evolution of implementation PPP, and also characteristic and criteria of PPP based on Public Private Partnership Guidelines. This paper also examines the potential benefits of PPP implementation in Malaysia based on the previous study. Last but not least, issues and recommendation for future study has been suggested to enhance PPP implementation project.

International Journal on Advanced Science, Engineering and Information Technology

Infrastructure projects require a great amount of capital investment resulting from their tremendous size, complexity, and risk. Due to the limitation of public finances, the private sector is invited to participate in infrastructure project development. The private sector can entirely or partially invest in an infrastructure project in the form of a public-private partnership (PPP) scheme, which has been an attractive option for several developing countries, including Vietnam. Unfortunately, despite the PPP scheme will improve project efficiencies and attract capital investments of private investors, the success of PPP implementation is not guaranteed. This paper investigates the critical success factors (CSFs) of PPP infrastructure projects in Vietnam. Relevant data were collected through in-depth interviews with six PPP experts and questionnaire surveys with 150 interviewees and then analyzed by the word cloud technique and the one-way analysis of variance (ANOVA) test. The CSFs were ranked based on the viewpoints of the public sector, the private sector, and the PPP consultants. The outcomes show that there was no significant difference in the perceptions of all three parties concerning the success factors for PPP infrastructure projects in Vietnam. The top five critical success factors are (1) timely land acquisition and appropriate compensation, (2) financial capacity of the private sector, (3) effective project management, (4) favorable and complete legal framework and regulations, and (5) financial feasibility and attraction. Recognizing the CSFs is indispensable to ensure the success of PPP infrastructure project implementation.

Public Policy and Administration Research, 2014

Public Private Partnership (PPP) is collaboration between public and private sectors in public service delivery as an alternative solution to the ever-increasing challenges in public service delivery. The success of implementing PPP around the world has been an attractive alternative for procuring public service works to the private sector. Establishing an enabling legal and institutional environment is the basic precondition to establish PPP arrangement in the development process. Accordingly, this study focuses on assessing international best practices as to how rapidly developing countries involve the private sector in their respective development process. This study takes the case of South Korea. Document review method was employed to assess how South Korea institutionalized PPP as part of its development strategy. Some selected government policy-documents, book chapters and articles are collected and consulted to finalize this study. The findings of this study reveal that the legal and institutional systems organized in South Korea are well established. Act on PPP and its Enforcement Decree constitute the major legal framework. Agencies like Ministry of Strategy and finance (MOSF) and Private Infrastructure Investment Management Center (PIMAC) represent institutional frameworks that can be taken as best practice for developing countries. Though most special government support schemes are introduced, some of the components, such as Minimum Revenue Guarantee (MRG) and allowing public property to private partners to use it free of charge, may be adopted with its appropriate controlling mechanisms. Hence, getting lessons from the experiences of South Korea with careful investigation of specific issues and contextualization of objective conditions in developing countries is warranted.