BOT transportation: Need a comprehensive view

BOT projects: Harmonizing the benefit of the State, people and enterprises

The mistake in establishing the toll stations would cause concern for people rather than fee rate.

What are benefits achieved?

For 5 years (2011-2016), the Ministry of Transport mobilized VND 171,308 billion, in which BOT capital was VND 154,481 billion for 59 projects, accounting for 90.2% of total mobilized capital. Currently, the country has completed and put into operation 55 BOT projects with the total investment capital of VND 137, 819 billion, all these projects are in the road sector.

The socialization of investment in transport infrastructure has significantly changed the transport infrastructure in our country, and is a major breakthrough by the Transport sector in reducing the burden on the State budget.

However, according to Dr. Nguyen Xuan Thuy, the former Director of Transport Publishing House and the traffic expert, after putting into operation and collecting toll for capital refund under the roadmap of BOT projects, there are many obstacles and shortcomings on quality and implementation mode that have arisen, especially with toll collection, causing an urgent matter in public opinion. The main reason for the urgent matter is the establishment of toll stations with many BOT projects established on key roads, leading to people having to use a BOT project. Especially, many toll stations do not ensure the distance in the same route or are in reasonable places. Notably, under regulations, the form of BOT investment in the Transport sector is to build new roads. But almost all BOT projects have not been built on new roads, they are only upgraded and improved current roads.

What are the losses?

Assessing the shortcomings in implementing BOT projects, talking with the correspondent of Customs Newspaper, the economic expert Dang Dinh Dao, former Director of the Institute for Economic Research and Development, National Economics University, said that the selection of investors to build BOT projects was not transparent, mainly the appointment of contractors and was not implemented publicly. This method caused the loss of a competition mechanism in which factors such as investor cost, profits, fee rate, and times for toll collection were only implemented through agreement and were not transparent. In addition, almost all BOT investors only have 15% of capital, and the additional 85% is borrowed from banks with a low interest rate and guaranteed by the State.

Agreeing with the opinion of economic expert Dang Dinh Dao, Dr. Nguyen Xuan Thuy added that the place for establishing the toll stations was very important, as it would affect the amount of revenue collected and efficiency of investment, as well as the opinion of people. A mistake in establishing the toll stations would cause concern for people rather than the fee rate. Such as the Cai Lay case, where the exemption and reduction of fees for each means of transport by the Ministry of Transport did not reassure public opinion.

“Besides, BOT operators are providing ways to prevent the method of one-stop toll collection and non-stop toll collection. Because there are no mechanisms to control the number of means of transport circulating on BOT projects, thereby we cannot control the time of collecting tolls, while investors always make the maximum profit by reporting the number of means of transport lower than the actual quantity. Specifically, through the inspection and supervision by the Ministry of Transport in BOT toll stations, the revenue from fee collection over the past time increased more than the same time in previous months” Mr. Thuy stressed.

Therefore, the economic expert Dang Dinh Dao proposed that the investors only establish the BOT toll station on new roads. The roads which were only improved by making pavements or extended must be closely inspected for finalizing. The investors only permitted to establish toll stations for new BOT roads 20m or 50m away from the highway. People wanting to use the BOT highways must implement fee payment to avoid the situation of “taking all in revenue” as in the present day.

According to Dr. Nguyen Xuan Thuy, it is necessary to develop plans on collecting BOT fees in the country approved by the Government, even through issuing specific provisions on BOT, such as specifying provisions on controlling investment cost, capital mobilization, contract management, responsibility of individuals and organizations, providing transparent mechanism on investor selection and financial plan. Thereby, avoiding the situation without specific methods and establishing many toll stations to collect fees as present day. Especially, quickly applying e-toll collection and non-stop toll collection services at BOT toll stations in the country. Hence, the fee amount for investors can be publicized.