Ho Chi Minh City will set up a specialized team focusing on the making of appropriate policies and regulations to attract private investments in infrastructure projects under the Public Private Partnership model.

It is a part of HCMC government’s master plan to call for private sector’s participation in many sectors including transport, flooding prevention, urban development, health, education-training, and science-technology under the PPP model.

According to the HCMC People’s Committee, infrastructure projects will need a total of VND815 trillion ($39 billion) investment from now to 2020.

However, the city could only be self-sufficient at about 1/13 of the total necessary investment capitals, some VND64 trillion (or around VND8 trillion per year).

The rest have to be funded by extra-budgetary sources, said the city’s government. Vietnam will need $15 billion a year for infrastructure development from now till 2020, according to the Vietnam Chamber of Commerce and Industry.

With limited state budget, finding out a foreign investor in the form of PPP is considered a good choice, according to the second Vietnam – Japan public – private policy dialogue held by the Vietnamese Ministry of Planning and Investment in Hanoi last month.

PPP investment for infrastructure development is a very successful experience in many developed countries in the world like France, the UK and Germany as well as emerging industrial countries like China and India.

But, the model remains relatively new in Vietnam.

Although investment formations like BOT (build – operate – transfer), BT (build- transfer) and PPP have been legalized by the Decree 108/2009/ND-CP, their real-life applications are still very limited, failing to meet expectations.