The International Union for Conservation of Nature (IUCN) in Vietnam and the Vietnam Business Council for Sustainable Development (VBCSD) under the Vietnam Chamber of Commerce and Industry (VCCI) recently co-organised a dialogue programme in combination with a press itinerary called “Enhanced public-private partnership in protection of marine environment and coastal areas" in Hanoi and Ha Long Bay. The programme drew the participation of central agencies, coastal provinces and cities, business representatives and media agencies.
At the dialogue, Ho Cong Hoa, an expert from the Central Institute for Economic Management (CIEM), presented a worrying figure. Nearly 90 percent of State budget is invested in infrastructure development and only 10 percent is allocated to infrastructure management and conservation. ODA that Vietnam receives for environmental protection is decreasing. Besides, the increase in State budget for environmental protection is very low, averaging 5.1 percent a year. Hence, Vietnam must have additional capital source for the protection of marine environment and coastal areas rather than rely on the State budget. It must establish institutional orientations and policies to attract external funds, including private fund via the public-private partnership (PPP).
Ms Vu Quynh Le, Deputy Director of Procurement Management Department under the Ministry of Planning and Investment, said the government is very interested in applying PPP in the environmental field. Recently, the government directed the Ministry of Planning and Investment to study the application of PPP mode to climate change projects. Currently, a lot of environmental projects are being researched and developed in the PPP mode, like Soc Son high-tech waste disposal project in Hanoi, wastewater treatment projects in Ho Chi Minh City, and wastewater and waste treatment projects in industrial zones.
However, PPP is not a skeleton key to solve all issues. Such difficulties as insufficient legal framework, inexperienced project personnel and unfair distribution of responsibilities and benefits are huge barriers to forming a really effective PPP model. Representatives of some companies regard PPP projects as investment projects where private investors could seek profits. Hence, profitability must be good enough for them to recover investment capital as in other forms of ordinary business.
Mr Nguyen Quang Vinh, Director of the Business Office for Sustainable Development (VCCI), said that the State must function as a good policymaker to attract stakeholders. Mr Tran Anh Tuan, Vice Chairman of Ben Tre Provincial People's Committee, affirmed, “When embarking on building projects in Vietnam, localities, policymakers, specialists, businesses and citizens need to come to a common consensus.” How to create a consensus among stakeholders remains a difficult problem for marine and coastal environment projects.
Mr Ho Cong Hoa added that Vietnam needs to continue studying and applying PPP in environmental services. Policy incentives are very important but creating a transparent, level playing field is much more important.
CIEM Deputy Director Vo Tri Thanh saw PPP difficulties from other aspects. Economists have not computed or valued resources as an input price in production. Even the methods of calculating resources capital, environment and society in consolidated project reports are inadequate because they do not reflect market signals.
Thus, PPPs are effective only when actually meeting market demands and market signals, having reasonable valuation of environmental resources, and creating an agreed mechanism among stakeholders: State, businesses and citizens.
Huong Ly
Vietnamese
