Caution urged on transport projects

Published: 14/03/2011 05:00



Permanent deputy chairman of the
Viet Nam Bridge and Road Association Nguyen Ngoc Long spoke with Tuoi Tre
(Youth) newspaper about transport infrastructure projects.

Why did you
say authorities needed to be cautious when finishing infrastructure projects
built under the BOT (build, operate, transfer) and BT (build, transfer) models?

We must pay greater
attention to how these projects affect society. These projects have already had
an impact on people because they have cleared massive portions of land and
rebuilt old roads. You also can’t forget that once the projects are finished and
toll stations erected, people will bemoan the new fees that they will have to
pay. So, I’m just saying we need to be prudent with how we handle these cases.

What is the
status of the BOT and BT projects?

Facts have shown that
the nature of between 70 and 80 per cent of BOT or BT transport infrastructure
projects has changed when they are completed. Some important projects now rely
on State funds. There were BOT projects which must be changed because they
failed to please the project’s investors and local authorities (or State
management offices). A typical example is Binh Trieu Bridge, which was a BOT
project but toll collections led to traffic jams which forced city authorities
to buy back the project.

In my opinion, we
need to summarise and assess the advantages and disadvantages that are produced
by BOT and BT projects. There are project, which were initially proposed to be
implemented under the BOT model, but they were reconfigured into
Public-Private-Partnerships at the last minute. This is what happened with the
Dau Giay-Phan Thiet Highway which is being built. Many international
organisations want to provide private companies with loans, but the Government
must provide the collateral.

You said we
must carefully consider what projects will follow the BOT and BT models. Which
factors do we need to consider carefully?

We must select
sufficient and committed investors. We should not choose an investor who has a
lot of money, but knows nothing about the transportation sector or
infrastructure projects.

Secondly, policies
related to the management of transportation infrastructure projects must be
consistent. Thirdly, it is a must that projects are closely supervised during

BOT projects have the
ability to mobilise funds from investors and share risk with them rather than
with the State. Hence, punishment must be meted out to BOT investors who failed
to fulfil the contractual terms that they signed on to.

Is it true
that some investors do not pay attention to BOT projects’ life-span after they
retrieve principal and transfer the project to the State?

Due attention must be
given to sustainable development when BOT projects are approved. Many BOT
investors aim to secure project deals quickly, but do not pay the same attention
to making sure the project develops properly. So by finding dedicated honest
investors, the projects run smoothlier.

Nam News

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