Transparency is key to resolving land-related bottlenecks.

The fact that the Ministry of Finance is seeking feedback on the draft Decree amending and supplementing a number of articles of the decrees detailing the implementation of the Law on Investment under the Public-Private Partnership (PPP) method shows an effort to continue improving the legal framework and removing bottlenecks.

In this context, the issue of land – particularly the mechanism of paying for BT projects with land funds – continues to emerge as a key problem, directly affecting market confidence and the ability to mobilize private resources for infrastructure development.

First and foremost, transparency of land fund information needs to be at the center. The draft requires the public disclosure of investment policy decisions but only "encourages" the disclosure of the location and area of ​​the land fund used for payment. According to the Vietnam Chamber of Commerce and Industry (VCCI), this approach does not guarantee transparency because the right to disclose or not still depends on each locality. In practice, the lack of transparency in land valuation and use has been a direct cause of many disputes and losses. Therefore, mandatory full disclosure of land fund information is a condition for strengthening market confidence. When information is clearly disclosed, the market has a basis for comparison, and management agencies have more tools for social oversight – this is the foundation for land transactions in PPP projects to approach market principles, instead of depending on administrative decisions.

Another issue is how to determine infrastructure construction costs when calculating the value of land used for payment. The draft allows for cost deductions based on investment rates, but according to feedback from businesses, this tool is mainly for reference purposes. Each BT project has very different characteristics; without an independent appraisal mechanism and market comparison, the risk of cost discrepancies is unavoidable. The consequences could be the loss of public assets or the distortion of the investor's financial plan – both undesirable outcomes.

Regarding land valuation, the regulation applying the highest price in the land price table when "no similar area can be identified" needs careful consideration. In theory, this is a way to prevent the loss of state assets. However, in practice, due to the lack of clear criteria for "similar areas," the implementing agency may choose the safe option of immediately applying the highest price. In this case, the risk is not addressed but simply shifted to the investor. A plot of land with incomplete infrastructure being valued at the same level as the most developed area will create a significant discrepancy compared to its real value, directly impacting the financial plan and reducing the project's attractiveness. In the long term, this could make investors more cautious about BT projects, leading to a reversal of the goal of mobilizing social resources that PPP policies aim for.

On the positive side, the draft has approached the principle of risk sharing, as evidenced by the provision for compensation when the State delays land allocation or leasing for BT contract payments. This is a step in the right direction, reflecting a balanced approach to benefits for both parties. However, for this regulation to be implemented effectively, it is necessary to clarify how interest rates are determined and the timing of their calculation, avoiding differing interpretations during application – a source of many disputes in previous PPP contracts.

Overall, the feedback from businesses reflects a consistent requirement: the legal framework for PPPs must be transparent, stable, and balance interests. Land is not only a means of payment but also a decisive factor in the feasibility of the entire project. When this bottleneck is removed with clear and reasonable regulations, PPPs can become an effective channel for capital flow in infrastructure development, instead of continuing to be a sector that investors want to participate in but are hesitant to enter.

HA MY

Source: https://www.sggp.org.vn/minh-bach-de-thao-go-nut-that-dat-dai-post847437.html