14:28 | 21/08/2016 Economy
(VEN) - US businesses had invested strongly in Vietnam, believing that the country would achieve strong growth as a Trans-Pacific Partnership (TPP) member, said Arun M. Kumar, Assistant Secretary for Global Markets and Director General of the US and Foreign Commercial Service in the US Department of Commerce.
The US water supply and drainage business delegation meets the media in Ho Chi Minh City
Arun M. Kumar led a delegation of US water supply and drainage companies to Ho Chi Minh City in late July to seek investment opportunities.
Ho Chi Minh City has encouraged investors to develop their projects through public-private partnerships (PPPs) in order to mitigate the burden on the local budget and attract financial resources as well as experiences and skills of investors from all economic sectors, with priority given to PPPs in water supply and drainage. The city needs to invest more than VND66 trillion in this sector in the 2016-2020 period and intends to raise over VND15.88 trillion through PPPs to invest in four wastewater treatment plants.
The government has issued Decree 15 on PPP investment and Decree 30 with detailed stipulations on the implementation of some investor selection-related articles of the Bidding Law, providing important legal bases for PPPs to develop.
According to Ho Chi Minh City Communist Party Committee Secretary Dinh La Thang, the city is willing to create favorable conditions for US investors to invest in the city, especially in wastewater treatment, environmental sanitation, and flood prevention.
Arun Kumar said only 70 percent of Vietnam’s population currently had access to clean water. The rest population far from clean water access provide a potential market fragment for investors in the fields. Many US companies are willing to participate in projects in Ho Chi Minh City, especially infrastructure and wastewater treatment projects. The large, dynamic, rapidly growing Southeast Asian market with high demand for water has attracted the attention of US businesses.
To help the Vietnamese government achieve major goals, the World Bank has provided assistance for the local water sector through PPPs. Vietnam has announced 23 major wastewater treatment projects but most of them aim at building new facilities, not improving existing facilities. US businesses hope to create meaningful partnerships that contribute to this sector’s growth in Vietnam.
US companies are seeking opportunities to invest in Vietnam in areas such as using solar panels to produce drinking water, and drinking water treatment. Alan Morgan, General Director of the Hydro Instruments Company, is interested in the Vietnamese market because its demand for clean water and wastewater treatment is very high. Bob Mason, Chief Executive Officer at The Ford Meter Box Company, said they wanted to provide training to improve capabilities for Vietnamese businesses.
In the opinion of Bob Mason, however, financial limitations are the biggest challenge to Vietnam. Tap water in Vietnam is not clean enough to be drunk instantly, so the local water sector needs to have quality equipment and better infrastructure. This requires large amounts of investment capital, and to do this, Vietnam needs to attract foreign investors, including US companies with advantages in terms of capital and technology.