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Private investors want loans for infrastructure projects   2008-06-26 - ThanhNienNews

The main contractor for the Phu My Bridge, which will connect HCMC’s districts 2 and 7, is a foreign consortium.  
Private companies feel that loan restrictions are leaving them out of big infrastructure projects, said participants at a seminar Wednesday.



Vu Quang Hoi, Chairman of the Binh Minh Import Export Production and Trade Co., Ltd. (Bitexco), said Vietnam’s most realizable infrastructure projects have been handed to state-run companies.

Hoi said Vietnamese authorities do not allow private companies to access preferential loans from official development assistance (ODA) or loans from the Asian Development Bank and the World Bank (WB).

He also said that the Vietnam Development Bank, which specializes in loaning for infrastructure projects, has set strict conditions and limits on loans for private enterprises.

The bond market is also underdeveloped, said Hoi.

Nguyen Khac Than, deputy general director of the Bank for Investment and Development of Vietnam (BIDV), said private companies want to have the same “rights” as state companies.

A more competitive environment, a more perfect legal system, and a stable economy would be important factors to attracting private investment in infrastructure projects, Than said.

WB representative Kamran M. Khan said the government should focus on developing the finance market and make clear all investment regulations.

Hoi from Bitexco proposed that private enterprises investing in infrastructure projects be given the chance to apply for preferential loans from international finance organizations.

He also said the Vietnam Development Bank should boost infrastructure development loans to private companies.

BIDV’s Than said capital from the state budget, ODA, and government bonds would meet only 20-30 percent of the average yearly demand for infrastructure projects between now and 2020.

The Ministry of Transport said in a recent report that it expected to need nearly VND166 trillion (US$9.99 billion) annually for its projects between now and 2020.

It said the projects included the North-South High-Speed Railway, existing railway upgrades and local port improvements.

The seminar was held by the Finance Ministry, the Ministry of Planning and Investment and the World Bank.

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