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PPP a knight in shining armor: With Vietnam facing challenges from poor infrastructure due to a dearth of capital, the Public Private Partnership investment model could be the answer. However, Vietnam has yet to grasp the concept. Ngoc Linh finds out why.

Article Excerpt
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The economy's rapid growth in recent years and booming foreign direct and domestic investment require better infrastructure systems in Vietnam, now considered a big obstacle to the country's development. But, a better infrastructure system needs huge investment capital, out of the reach of the government or even official development assistance (ODA) from other countries. In this case, the Public Private Partnership (PPP) model could prove a salvation.

PPP implies collaboration between the government and the private sector in carrying out projects with social benefits, under an agreement to share the responsibility and risk. According to this agreement, the government determines criteria for the delivery of services and offers incentives for the private sector by setting up payments based on their quality.

PPP contracts offer great benefits especially in projects that require large amounts of capital because of their lower costs and the value created by commercialising projects.

PPP is common in countries like Japan, Singapore, United States and United Kingdom. In Japan, even prisons were built with PPP contracts. However, PPP projects are as rare...

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