Private investors see opportunities in infrastructure development

12:25 | 29/07/2015 Investment

Many investors have registered to develop railways, airports, seaports and highways, but developing infrastructure, a lucrative business field, only suits financially powerful investors.

Private investors see opportunities in infrastructure development

Analysts say they can see a second wave of private investment in infrastructure projects.

The first investment wave occurred in 2006-2007, when the real estate market heated up. A lot of enterprises jumped into the field, though many of them then had to say ‘goodbye’.

According to the Ministry of Planning and Investment, from now to 2020, Vietnam will need $16-17 billion a year for infrastructure development, of which only 50-60 percent would be from the state budget.

Tens of registrations to develop infrastructure items have been made by private investors this year.

Vingroup in late April started the construction of the Phu Quoc Port which covers 179.3 hectares of land. Once operational, the port will be able to receive international ships with tonnage of 225,000 GT, capable of carrying 6,000 people.

Vingroup, owned by Pham Nhat Vuong, recognized by Forbes as the Vietnamese dollar billionaire, has also informed the Ministry of Transport about its willingness to buy three largest railway stations in Vietnam, namely Hanoi, Sai Gon and Da Nang.

While Vingroup targets railway stations, Sun Group is lobbying for the right to invest in railroads and trains to upgrade services. The group is now developing many tourism and resort projects in the central region, and hopes the upgraded railway services will help bring more customers to the resorts.

Airports and airport terminal are also infrastructure items private investors target. 

Rang Dong Group, a local corporation in Binh Thuan province, has invested in infrastructure items at Phan Thiet Airport, including the terminal in a VND1.6 trillion project, expected to be put into operation in 2018.

At the end of the first quarter, Sun Group was chosen by the Quang Ninh provincial authorities as the investor for the Quang Ninh Airport (one runway and a terminal with the capacity of 2 million passengers and 10,000 tons of cargo a year).

Sun Group obtained the project after defeating many other domestic and foreign investors, including Joinus Vietnam, Posco E&C and KAC from South Korea.

In June alone, two joint groups of investors suggested expanding the terminals at two airports.

Viet Xuan Moi JSC and Duc Binh Group have proposed to develop the terminal at Cam Ranh Airport under the mode of BOT with estimated capital of VND1.9 trillion.

While Rang Dong is well known in Binh Thuan province, CII is well known in HCM City as the biggest infrastructure developer. CII is now the investor of eight transport projects implemented under many different modes, from BOT to BT./.

Source: Vietnamnet