Proposal to remove difficulties in minimum equity capital of expressway investors
Lam Dong Transport Project Management Board proposed that Lam Dong Provincial People's Committee report and recommend to the Prime Minister to remove difficulties and obstacles regarding minimum equity capital of investors proposing to invest in 2 expressways.
Mr. Nguyen Thanh Chuong, Director of Lam Dong Transport Project Management Board, has just reported to the Provincial People's Committee some difficulties and problems in mobilizing capital for two expressway projects: Tan Phu - Bao Loc, Bao Loc - Lien Khuong.
According to the investment policy approved by the competent authority, both Tan Phu - Bao Loc and Bao Loc - Lien Khuong expressway projects have large mobilized capital (Tan Phu - Bao Loc expressway project is about 9,095 billion VND, Bao Loc - Lien Khuong expressway project is about 9,996 billion VND), which makes the payback period of the project quite long; reducing the feasibility and attractiveness to investors and credit institutions lending capital to the 2 projects (through the survey results of investor interest, each project has only 1 interested investor).
At the same time, at present, the world economy is experiencing many major fluctuations, so commercial banks are less interested in projects with long payback periods, especially investment projects under the public-private partnership method (PPP projects).
However, the State investment credit institution, the Vietnam Development Bank (VDB), still creates conditions for enterprises to borrow capital to implement projects, but the lending conditions of the State investment credit institution according to Clause 3, Article 1, Decree No. 78/2023/ND-CP dated November 7, 2023 of the Government stipulates that "the owner's equity participating in the project implementation process is at least 20% of the total investment capital of the project (excluding working capital)..." is not consistent with the provisions of Clause 1, Article 77, Law on Investment under the Public-Private Partnership (PPP Law) which is "the owner's equity is at least 15% of the total investment of the project excluding state capital", so it is difficult to borrow capital to implement PPP projects.
To ensure feasibility and facilitate the search for capital mobilization for the above two expressway projects, Lam Dong Transport Project Management Board recommends that Lam Dong Provincial People's Committee report and recommend the Prime Minister to remove difficulties and obstacles regarding the minimum equity capital of investors according to the provisions of Decree No. 78/2023/ND-CP dated November 7, 2023 of the Government in the direction of adjusting Decree 78/2023/ND-CP to comply with Clause 1, Article 77 of the PPP Law.
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