This viewpoint was expressed by Minister Nguyen Van Thang during his explanation to the National Assembly on the afternoon of May 23rd, regarding a law amending and supplementing seven laws related to finance, including the Law on Investment in the Public-Private Partnership (PPP) mode.
In this draft law, the government proposes a mechanism to handle problematic BOT traffic projects and reduce revenue before the PPP Law takes effect (January 1, 2021). Specifically, the state will share with investors the difference between the financial plan and the actual revenue according to a certain ratio.
Regarding the challenges faced by BOT projects, Mr. Pham Van Hoa, a deputy from Dong Thap Province, mentioned that there are some projects that have been struggling for 4-5 years without resolution. Mr. Hoa requested to identify the cause of these difficulties.
“Is it the fault of the investor, the state, or both? We need to resolve this issue decisively because prolonging it causes losses for investors and is also ineffective for the state,” he stated.
In response to the deputy, Minister of Finance Nguyen Van Thang acknowledged that “some BOT projects are facing difficulties due to the state’s responsibility, not the investors. Therefore, it is our duty to resolve these projects.”
 Minister Nguyen Van Thang explains to the National Assembly, afternoon of May 23. Photo: National Assembly Press Center
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Minister Thang explained that during the 2011-2022 period, the government reported to the National Assembly and issued resolutions to address these issues. However, during the implementation process, the Prime Minister requested a thorough review, and the Ministry of Transport (now the Ministry of Construction) worked with each investor and financing bank to reduce interest rates and remove the profit margin for investors from the projects to recalculate. As a result, the amount required to resolve the problematic BOT projects decreased from 10,000 billion VND to 8,000 billion VND.
In addition to the two resolutions of the National Assembly on resolving these projects in the past, Minister Thang informed that in February, the competent authority requested further handling of the struggling BOT projects. Not only addressing the projects currently being handled, but the Minister of Finance also mentioned that there will be more projects that need to be resolved when the North-South expressway is opened. Once the projects are operational and toll collection begins, it will be possible to determine the traffic flow and assess the impact.
Moreover, in the next five years, according to the Minister of Finance, with the plan to build an additional 2,000 km of expressways and transverse roads, many other local BOT projects will also be affected, requiring a handling mechanism.
“The difficulties faced by these projects are due to the state’s adjustment of planning and the expansion of the North-South expressway. Therefore, the Ministry of Finance proposes to legalize the regulation on handling these projects when amending the PPP Law to have a legal framework and be proactive instead of handling each group of projects individually,” Mr. Thang added.
According to the amendments in the PPP Law, the government proposes a mechanism for sharing between the state and BOT projects that encountered difficulties before 2021, which will be applied only once when the project cannot collect service fees, and the actual revenue in the last three years is less than 75% of the amount stated in the PPP contract… due to changes in policies and planning.
The mechanism for sharing the reduction in revenue will not be applied in cases where the financial plan is adjusted according to profit on owner’s equity, interest rates on loans, or repayment methods that are agreed upon but do not ensure feasibility.
The government will detail the method for determining the sharing ratio, the procedure for implementing the mechanism for sharing the reduction in revenue. The Minister, Chairman of the Provincial People’s Committee shall decide on the application of revenue sharing and the ratio for projects approved by himself, avoiding increases in prices, service fees, and extension of the toll collection period.
In the previous discussion, Mr. Nguyen Quang Huan, a member of the Committee for Science, Technology, and Environment, also requested a definitive solution to the difficulties faced by BOT projects operating before January 1, 2021. He cited the example of a BOT project at the gateway to the capital, across the Thang Long Bridge, which still charges a toll of 10,000 VND per turn because it has not yet recouped the investment.
“In 2022, the National Assembly issued a resolution to resolve the BOT projects decisively, but it has not been implemented yet. This time, by amending the PPP Law, we should resolve this situation decisively and not prolong it,” said Mr. Huan.
Mr. Nguyen Quang Huan, a member of the Committee for Science, Technology, and Environment, speaks at the discussion session on the afternoon of May 23. Photo: National Assembly Press Center |
In addition to resolving issues with BOT projects operating before 2021, in this law amendment, the government also proposes to allow the reapplication of the Build-Operate-Transfer (BOT) contract for projects involving the renovation and expansion of expressway infrastructure or the upgrading of existing roads into expressways.
According to this proposal, the state can share the reduction in revenue with investors and enterprises if the actual revenue of the project is lower than the figures stated in the financial plan of the BOT, BTO, and BOO contracts. The ratio for sharing the difference in reduced revenue will be determined by the government.
The revenue-sharing mechanism will be applied in cases where planning and policy changes lead to a decrease in project revenue. Along with this, investors and enterprises will have a financial plan to adjust service prices or fees or extend the PPP project contract term to up to 50 years, but the minimum revenue must be at least 75%.
The National Assembly is expected to vote on this bill on June 17.
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The Ministry of Health is supplemented with over VND 4,000 billion in non-refundable aid In the afternoon of May 23, with the approval of nearly 93% of the delegates, the National Assembly passed a resolution on supplementing the regular expenditure budget (from non-refundable foreign aid) for 2025. Accordingly, the National Assembly decided to supplement more than VND 4,327 billion from this source to the central budget revenue estimate for 2025. This amount will be added to the corresponding estimates of ministries and central agencies. Of this, the Ministry of Health is expected to receive nearly VND 4,081 billion, while the rest will go to other ministries and sectors. For example, the Ministry of Agriculture and Environment will receive nearly VND 127 billion for typhoon Yagi support. The Ministry of Science and Technology will receive nearly VND 19.2 billion for education and training. The Ho Chi Minh National Academy of Politics will receive nearly VND 4.4 billion… Da Nang City and Son La Province are proposed to receive over VND 11.7 billion and nearly VND 8.9 billion, respectively, for social security and local economic development. The National Assembly requested that the Government be responsible for the accuracy of the data and content of the proposal and ensure that the supplementary estimate complies with regulations on norms and expenditure regimes, preventing waste, corruption, and negative acts. The Standing Committee of the National Assembly, the Committee for Economic and Financial Affairs, and the State Audit Office of Vietnam were assigned to supervise and inspect the implementation of this resolution, ensuring compliance with regulations. |
Anh Minh
– 19:54 23/05/2025
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