I.The recent urban metro/railway projects in Vietnam II.Highlights of Vietnam’s Railway Master plan and Strategies III. PPP legal framework in Vietnam

1. Partnerships (PPP) to Implement Rail
Infrastructure in Vietnam
Hung Tran
CEO – Monitor Consulting
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GSM Rail Expansion Summit 2017
Hanoi, Nov.30- Dec.1, 2017

2. About Monitor Consulting
Who is Monitor Consulting
• A leading consulting company in Public- Private Partnership (PPP) and infrastructure consulting
practice in Vietnam;
• An integrated team of international and local professionals in project finance, PPP, legal and
project development.
Why Monitor Consulting is unique in Vietnam
• A proven track record of PPP, infrastructure project development and transactions in Vietnam;
• Our strengths and propositions are derived from a unique combination of expertise and
knowledge in PPP, Project Finance, Industry-specific experience and Government Insights;
• Engaged in the key developments of PPP legal and policy development in Vietnam for years;
• A unique depth and breadth of knowledge in dealing extensively with PPP legal and policy issues
of Vietnam.
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3. Railway has more rooms to develop due to the low historical
investment & its potential economic return
3
10.6
1.8 1 1.1
25.6
3.7
7.1
3
85
4.6
23.6
2.8
96.8
4.5
28.3
2.6
0
10
20
30
40
50
60
70
80
90
100
Roads Railways Air Transport Waterways
Billionpassenger-km
Transport Evolution , Vietnam, 1992-2014
1992 2002 2012 2014
• Source: GSO and Monitor Consulting’s Analysis
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5.5
4.5
3
1.5
Transport Projections, 2016-2020 ($ billion)
Road
Railway
Airway
Marine
Inland waterway
• Source: MOT and Monitor Consulting’s Analysis

4. • Length: 19.7 km
• Adjusted investment: US$2.5 billion
• Construction: 2007-2020 (expected)
• Funding source: Japanese ODA
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The recent urban metro/railway projects in Vietnam
Hanoi
• Length: 13.05 km
• Adjusted investment: US$870 million
• Construction: 2010-2018 (expected)
• Funding source: Chinese ODA
HCM City

5. Highlights of Vietnam’s Railway Master plan and Strategies
• Focus on railway infrastructure connecting economic hubs, ports,
industrial zones and neighboring countries
• Urban railway development with the priorities in Hanoi and HCMC to
improve metropolitan mobility
• PPP is expected to play an important role to mobilize capital for rail
projects
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6. Pipeline of Major Railway Projects
1. Upgrade existing railroad gauge from one meter to 1.435m
2. Phased construction of a North-South high speed train
3. Urban railway system In Ho Chi Minh City (08 routes) and
tramway/monorail projects
4. Urban railway system in Hanoi (10 routes) with estimated investment
US$40 billion
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7. 7
LAWS Procurement
Law
CIRCULARS
Circular 02/2016/TT-
BKHĐT- Guidelines
on PPP project
selection, project
proposal, FS
assessment and
approval
DECREES
Decree 30/2015/NĐ-
CP dated 17/3/2015
on Investor selection
Decree 15/2015/NĐ-
CP dated 14/02/2015
on PPP
Construction
Law
Investment
Law
Circular
55/2016/TT-BTC
Financial
management of PPP
projects
Circular
15/2016/TT-
BKHĐT-
guidelines on RFQ,
RFP for PPP
projects
PPP legal framework in Vietnam
Public
Investment
Law
Budget Law
Circular 06/2016/TT-
BKHĐT- Guidelines
on converting public
investment projects,
PPP contracts,
investment
certificates & PE
PPP Circulars
by functional
ministries

8. • PPP seems to be critical option given the state budget tights
• The PPP law will be soon drafted to replace the PPP decree
• Financial mechanisms for PPP: PDF (US$30 million); VGF : on study
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The good news with PPP in Vietnam

9. Key challenges in financing rail projects in Vietnam
• Fiscal Constraints (High budget deficits and high level of government debt
and pressure to reduce, less concessional ODA) and less room to finance
large rail projects by state funding
• Complexity and incomplete legal framework to attract private investment
• Governance in policy making, project procurement and project delivery
• Lack of bankable rail projects
• Undeveloped capital markets
• Lack of necessary in-country capacity
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10. Finding the right partners in rail projects in Vietnam
• Most of railway projects are categorized as National or Class A
projects which needs the approvals from the Central Government,
even urban railway projects in local authorities
• Implementing agencies are Ministry of Transport and/or Local
authorities (Hanoi, Ho Chi Minh City)
• Most of potential local investors in urban rail projects are from real
estate sector
• Local private rail operators are not existed
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11. Unsolicited urban railway projects are on the rise
• Leading local real estate developers are interested in urban railway
projects in Hanoi
• Unsolicited proposals maybe the case as long as the government’s
limited capability to prepare the feasibility studies
• Competitive bidding vs. Unsolicited proposals
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12. Hung Tran – CEO
Email: hung@monitor.com.vn
Mobile: (84) 903443690
Monitor Consulting
16th Floor, Icon4 Tower, 243A De La Thanh Street,
Dong Da District, Hanoi, Vietnam
www.monitor.com.vn
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