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Saturday, July 31, 2021

HCMC’s traffic infrastructure projects unattractive to foreign investors

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HCMC – Among the 11 national projects for which the HCMC government had been seeking foreign investors by 2020, eight are traffic infrastructure projects but all of them have attracted no foreign investors.

According to an urgent document sent by the municipal government to the Ministry of Planning and Investment, the 11 projects comprise a bus station at the Cho Lon area, three elevated roads, monorail lines No. 2 and 3, tramway No. 1, metro line No. 6, the Tay Bac solid waste treatment complex in Cu Chi District, an international university urban area in Hoc Mon District and hospitals in the Tan Kien medical cluster in Binh Chanh District.

Of these, only the international university urban area project in Hoc Mon District has found a foreign investor, Berjaya Leisure (Cayman) Ltd. The remainder have found no foreign investors, Thanh Nien Online newspaper reported.

According to the HCMC government, metro line projects play an important role in the city’s public traffic infrastructure development plan. However, they can prove their effectiveness only when they find investments and are developed in a synchronous manner.

In the 2016-2020 period, the execution of the first and second metro line projects faced multiple difficulties and challenges. Although the city has worked with many investors to seek cooperation opportunities, foreign investors have shown little or no interest in traffic infrastructure projects.

In addition, these projects require a huge investment, especially for compensation and site clearance, so investors must have a strong financial capacity. Official development assistance loans for urban traffic infrastructure development are increasingly cut, while the current regulations are not yet conductive to public-private partnership investments.

As a result, the city has found it hard to call for foreign investors for infrastructure projects.

As for the Tay Bac solid waste treatment complex project in Cu Chi District and hospitals in the Tan Kien medical cluster in Binh Chanh District, the city has used its budget for compensation and site clearance. The city will continue seeking investors for these two projects through auctions of land use rights or tenders to choose investors in line with the law.

The city has also proposed adding seven more projects to the list of national projects to call for foreign investors in the 2021-2025 period, including the second phase of the second metro line, metro line 3a, metro line No. 4, the first phase of the fifth metro line, a financial center at the Thu Thiem New Urban Area, the Rach Chiec National Sports Complex, a convention and exhibition center and hotels and a trade-service area in the functional area No.1 of the Thu Thiem New Urban Area.

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