Policies improved to lure investment in PPP projects

VCN – A financial management mechanism for public-private partnership (PPP) investment projects will be developed in accordance with prevailing management principles to create a favourable and attractive environment for investors who really have financial capacity and experience in project management.
Regulations on financial management for PPP projects to be developed Regulations on financial management for PPP projects to be developed
Ownership, risk-sharing must be clarified in PPP law: experts Ownership, risk-sharing must be clarified in PPP law: experts
The State shall share 50 % of decreased revenue with investors of PPP projects The State shall share 50 % of decreased revenue with investors of PPP projects
1842-5320-10-unnamed-2
The Ministry of Finance is consulting about the draft decree on financial management mechanism for public-private partnership (PPP) investment projects.

Financial plan for PPP projects ?

The Law on Public-Private Partnership (PPP Law) was issued to create a general legal framework, with high, long-term and stable validity for the implementation of PPP projects in Vietnam.

According to the Ministry of Finance, the PPP Law basically coversissuesto be managed in PPP investment activities. However, for the content of financial management that needs flexibility in application and ensures compliance with reality, the law only stipulates the management principles and the Government will specify them in detail.

Under tasks given by the National Assembly to the Government on guiding the PPP Law, Prime Minister Nguyen Xuan Phuc in Decision No. 1109 / QD-TTg dated July 24, 2020, assigned the Ministry of Finance to review and develop the draft decree on the financial management mechanism for PPP investment projects.

The decree aims to improve policies to attract investors in PPP projects and comply with international practices and Vietnam’s conditions to create a favourable and attractive environment for investors who really have financial capacity and experience in project management.

One of the most important provisions regulations of the draft is on the financial plans of PPP projects.

The Ministry of Finance said that the financial plans are developed on the basis of after-tax cash flows which are discounted at the weighted average discount rate of the mobilising interest rates and the return on equity. Actual revenue will be the total revenue from providing public products and services, apart from value added tax.

For the financial plan in the pre-feasibility study report, the feasibility study report of PPP project includes eight contents: total project investment; capital sources for the project’s implementation; proposing incentives and guarantees (if any); return on equity; estimated expenses during operation phase; plan to recover invested capital and profits of investors; remittances to the state budget (if any) for projects implemented in the form of O&M contracts (Operation and Maintenance Contracts); criteria to analyse and evaluate the financial feasibility of the project.

"The above provisions will be the basis to develop and pass the financial plan in preparation and approval of bidding documents, negotiation and signing of PPP project contracts," the Ministry of Finance said.

Three management principles

The management, use and payment of state capital in the implementation of PPP projects have been specified in the draft decree.

Accordingly, there will be three principles of management and use of State capital to support PPP projects.

The first principle is that the percentage of State capital funded for building works and infrastructure systems, compensation, site clearance, resettlement and building temporary works must not exceed 50% of the total project investment level. The use of investment capital must be specified in the PPP project contract in terms of the rate, value, schedule and payment conditions.

The second principle is that the procedures and authority to decide on the use of public assets to support the construction of works and infrastructure systems must comply with the law on management and use of public assets.

The value of public assets is evaluated in accordance with the law on prices, the law on management and use of public assets as a basis for authorities to approve project investment policies.

Why do businesses hesitate when implementing PPP projects? Why do businesses hesitate when implementing PPP projects?

VCN – In order to meet the growing demand for infrastructure development, investment in the form of public ...

The third principle is that State capital to pay for PPP projects must be done under BTL contracts (Build - Transfer - Lease) or BLT (Build - Lease - Transfer) contracts.

By Thuy Linh/ Huyen Trang

Related News

Public accounting standards publication contributes to spreading investment attraction

Public accounting standards publication contributes to spreading investment attraction

VCN - According to a World Bank (WB) expert, the publication of public accounting standards not only helps strengthen the sustainability of the financial system but also creates a ripple effect in attracting private sector and foreign investment.
Does goods imported for investment incentives project subjected to tax exemption?

Does goods imported for investment incentives project subjected to tax exemption?

VCN - That is the problem of Ba Ria - Vung Tau Customs Department related to processing tax exemption documents for imported goods to serve investment incentive projects.
Seek for appropriate investment direction amid market fluctuations

Seek for appropriate investment direction amid market fluctuations

VCN - Many indicators show that financial investment activities might suffer from many variables in the second half of 2024. However, due to the current economy vitality, investors should pay attention to consider and choose appropriate investment channels, closely monitor and evaluate new developments.
Vietnam hopes to have a breakthrough in investment from Japanese ODA capital

Vietnam hopes to have a breakthrough in investment from Japanese ODA capital

VCN - On June 26, Minister Ho Duc Phoc had a meeting with Mr. Ito Naoki, Ambassador Extraordinary and Plenipotentiary of Japan to Vietnam. Speaking at the reception, the Minister said that Vietnam wanted to have a breakthrough in the process of investing ODA capital, focusing on large national projects.

Latest News

Promoting review, classification and management of tax debt

Promoting review, classification and management of tax debt

VCN - According to the General Department of Customs, the amount of overdue debt recovered and processed in the first 6 months of 2024 for the all Customs sector reached VND 349 billion. To ensure completion of tax debt collection and settlement targets, the General Department of Customs requires units to focus on reviewing debt management records to effectively implement measures to urge, collect and handle tax debt.
Documents required for vehicles transporting cargo across Lang Son Border Gate from August 1

Documents required for vehicles transporting cargo across Lang Son Border Gate from August 1

VCN - VCN- Vehicles carrying import and export cargo across customs clearance routes and specialized roads in the international border gate pair of Huu Nghi (Vietnam) - Huu Nghi Quan (China) must comply with international treaties and regulations of Vietnam Law. Accordingly, the vehicles transporting import and export cargo across Lang Son border gates are required to have at least seven valid documents from August 1, 2024, Lang Son Department of Industry and Trade notified.
Border gate area planning associated with digital transformation needs to prioritize human resources, equipment, and infrastructure

Border gate area planning associated with digital transformation needs to prioritize human resources, equipment, and infrastructure

VCN - According to Lang Son Customs Department, to implement the master plan of the land border gate area associated with the goal of digital transformation, in which, to ensure successful implementation of the Customs Development Strategy until 2023, Building digital Customs, a smart Customs model, it is necessary to review and evaluate the overall system of land border gates, paying attention to investment in equipment, facilities, and human resources.
Proposal to reduce registration fees to restore growth of domestic automobile industry

Proposal to reduce registration fees to restore growth of domestic automobile industry

VCN - Facing the significant decline in auto market sales in the last months of 2023 and early 2024, the Ministry of Finance is asking for opinions from ministries, central agencies and relevant agencies on continuing to reduce registration fee to restore growth of the domestic automobile industry amid many difficulties and challenges in the economy.

More News

VAT reform promotes sustainable development of the agricultural sector

VAT reform promotes sustainable development of the agricultural sector

VCN - In the revised Draft Law on Value Added Tax (VAT), the conversion of fertilizers and specialized machinery and equipment serving agricultural production to applying 5% VAT since it belongs to the group of subjects not subject to tax according to current law, it is a content that receives attention from the business community, especially fertilizer production enterprises. According to experts and businesses, converting this item to a taxable object will have a huge impact on agricultural production.
Customs implements VAT reduction policy from July 1st

Customs implements VAT reduction policy from July 1st

VCN - To implement the contents relating to customs field, General Department of Vietnam Customs requested local customs departments to reduce VAT for group of commodities as stipulated at Decree 72/2024/NĐ-CP.
Amend the Law on Corporate Income Tax to ensure stable revenue sources for the budget

Amend the Law on Corporate Income Tax to ensure stable revenue sources for the budget

VCN - According to the Ministry of Finance, the amendment of the Law on Corporate Income Tax (CIT) aims to overcome inadequacies and overlaps, ensure stable revenue sources for the state budget, and contribute to restructuring state budget revenues in a sustainable direction.
List of imported and exported medicine and medicinal ingredients identified commodity codes

List of imported and exported medicine and medicinal ingredients identified commodity codes

VCN – 14 lists of imported and exported medicine and medicinal ingredients for human use and cosmetics that have been identified commodity codes under Vietnam’s Imports and Exports Nomenclature, have been approved and issued by the Ministry of Health from July 26, 2024.
Hundreds of tons of imported raw cashew nuts stuck in quarantine

Hundreds of tons of imported raw cashew nuts stuck in quarantine

VCN – A company is facing problems with plant quarantine regulations when carrying out procedures to import over 384 tons of "raw cashew nuts, originating from Tanzania" from a bonded warehouse in Dong Nai.
Extend deadline for paying Special Consumption Tax on domestically produced and assembled cars

Extend deadline for paying Special Consumption Tax on domestically produced and assembled cars

VCN – The Government has issued Decree 65/2024/ND-CP dated June 17,2024 extending the deadline for paying Special Consumption Tax on domestically produced and assembled cars. The Decree takes effect from the date of signing until December 31, 2024.
Extend the deadline for paying taxes and land rent in 2024

Extend the deadline for paying taxes and land rent in 2024

VCN - The Government has just issued Decree No. 64/2024/ND-CP dated June 17, 2024 extending the deadline for paying value added tax (VAT), corporate income tax (CIT), personal income tax (PIT) and land rent in 2024. This Decree takes effect from June 17, 2024 to December 31, 2024. After the extension period according to this Decree, the deadline for paying taxes and land rent will comply with current regulations.
Tax payment deadline for domestic cars extended

Tax payment deadline for domestic cars extended

The Government has decided to extend the deadline for special consumption tax payment for domestically manufactured or assembled automobiles.
13 cases must register for tax at Tax office

13 cases must register for tax at Tax office

VCN - The Ministry of Finance is collecting comments on a draft Circular guiding tax registration to replace Circular 105/2020/TT-BTC. According to the draft, in case the National Population Database proactively transmits information to the Tax Database when issuing personal identification numbers, the Tax agency will immediately update the personal identification number into the Tax registration system to use as a tax code for individuals without requiring individuals to carry out tax registration procedures with the Tax authority.
Read More

Your care

Latest Most read
Promoting review, classification and management of tax debt

Promoting review, classification and management of tax debt

According to the General Department of Customs, the amount of overdue debt recovered and processed in the first 6 months of 2024 for the all Customs sector reached VND 349 billion.
Documents required for vehicles transporting cargo across Lang Son Border Gate from August 1

Documents required for vehicles transporting cargo across Lang Son Border Gate from August 1

VCN - On July 18, Lang Son Department of Industry and Trade notified the method of delivery and receipt of import and export cargo transported across customs clearance routes and specialized roads in the International Border Gate pair of Huu Nghi (Vietnam
Does goods imported for investment incentives project subjected to tax exemption?

Does goods imported for investment incentives project subjected to tax exemption?

That is the problem of Ba Ria - Vung Tau Customs Department related to processing tax exemption documents for imported goods to serve investment incentive projects.
Border gate area planning associated with digital transformation needs to prioritize human resources, equipment, and infrastructure

Border gate area planning associated with digital transformation needs to prioritize human resources, equipment, and infrastructure

VCN - According to Lang Son Customs Department, to implement the master plan of the land border gate area associated with the goal of digital transformation, in which, to ensure successful implementation of the Customs Development Strategy until 2023, Bui
Proposal to reduce registration fees to restore growth of domestic automobile industry

Proposal to reduce registration fees to restore growth of domestic automobile industry

VCN - Facing the significant decline in auto market sales in the last months of 2023 and early 2024, the Ministry of Finance is asking for opinions from ministries, central agencies and relevant agencies on continuing to reduce registration fee to restore
Mobile Version