Phu My bridge, a big PPP infrastructure project in HCM City. (Source: VNA)

HCM City (VNA) – HCM City should promote the public-private partnership model in infrastructure projects to diversify capital resources for developing urban infrastructure, according to economic experts.

At the conference on solutions to mobilising capital for infrastructure development in 2016-2021 held in the city on July 7, experts said the city will need up to 44 billion USD for urban infrastructure until 2021.

According to Nguyen Hong Van, Head of the Public-Private Partnership (PPP) Desk under the HCM City Department of Planning and Investment, it is necessary to promote Vietnam’s PPP market to foreign investors to reel in capital from the private sector, and gain international experience and capability.

The city should issue practical preferential policies such as land leasing or planning to encourage local and foreign investors to join the PPP model.

Attracting official development assistance (ODA) capital for infrastructure projects is an effective solution, according to Nguyen Thi My Linh, Deputy Head of the Finance & Bank Faculty of the HCM City University of Industry.

Linh said, land clearance and the legal framework are the main reasons foreign investors are shying away from infrastructure projects in Vietnam in general and in HCM City in particular.

During 2011-2015, 11,946 billion VND (526 million USD) out of the total investment capital of 38,608 billion VND (1.7 billion USD), or equal to 31 percent, was sourced from other resources outside the State budget and ODA.

As of the second quarter this year, the city has been implementing 19 projects using the PPP model.-VNA