HCMC – The Ministry of Construction has submitted a draft decree to the central Government proposing financial and regulatory support for 11 build-operate-transfer (BOT) road projects that were contracted before 2021 but are now facing financial constraints due to lower-than-expected revenue.
The proposed decree, expected to be issued in early September, introduces a revenue-sharing mechanism allowing government intervention if a project’s actual revenue falls below 75% of its original financial forecast for three consecutive years.
Under this policy, the Government would cover up to 75% of the average revenue shortfall, with compensation disbursed in a lump sum from the state budget. In exchange, project investors and lenders would be required to lower profit margins, reduce interest rates, restructure debts, and refrain from extending toll collection periods or increasing fees beyond what was originally agreed upon.
For projects deemed financially unviable, the decree outlines procedures for early contract termination and compensation. Eligibility for this support includes projects that have been in operation for at least two years but are unable to collect tolls or would require over 50 years to recoup investment capital, even after financial restructuring. Compensation will be based on audited costs minus any revenue collected, excluding investor profits.
The ministry has also proposed three options for calculating interest-related compensation during the operational phase: a fixed annual rate of 4%, the actual interest paid, or excluding interest altogether.
Vietnam launched 140 BOT infrastructure projects before 2020, mobilizing nearly VND319 trillion. Of these, 11 have been confirmed as facing significant challenges, while others may face risks stemming from policy changes and reduced or suspended toll collections.
The Ministry of Construction emphasized that the new decree aims to unlock private sector resources, improve the investment climate, and ensure balanced risk-sharing between the state and private investors.
