Voters in Binh Dinh province have sent recommendations to the Ministry of Transport, asking “Continue to implement non-stop toll collection and direct investors to have a plan to reduce ticket prices through BOT toll stations to support businesses and people affected by the COVID-19 epidemic.”
In response, the Ministry of Transport and Transport said that it did not agree to reduce the BOT ticket price because the investor was very difficult, and at the same time called on the owners of vehicles and transport enterprises to share difficulties with BOT enterprises. The ministry said that the current fee level is the road service use price calculated in the financial plan of the project contract, enough for the BOT enterprises to repay the capital raised to invest in the road BOT projects.
Dr. Ngo Tri Long, former director of the Market Research Institute under the Ministry of Finance, stated his view on this issue:
“In general, in terms of BOT, because COVID-19, the income as well as the revenue of production activities reduced greatly, not only businesses but also people.
According to the roadmap plan, the BOT must collect like that. Now people ask for a reduction, it cannot be reduced because if it is reduced, it must be extended. The BOT investors did not agree to the reduction because they thought that they also had difficulty in repaying bank loans. Recently, as they could not pay, so the debt was piled up. Faced with that situation, the Government decided by December 31st, all stations must implement non-stop toll collection.”
Non-stop toll collection is seen as a form of more benefits than manual toll collection such as convenience, time-saving, reduced traffic congestion, and especially raise the transparency of the revenues of BOT projects. According to Decision 19/2020 issued by the Prime Minister, BOT stations are required to install non-stop automatic toll collection and must be completed no later than December 31, 2020. If a station fails to implement it, it is due to the investor’s fault, and the station will be forced to stop collecting fees.
Previously, in November 2020, the Vietnam Association of Road Traffic Investors (VARSI) raised the issue of BOT fees with the Government. According to VARSI, the road user fees in BOT projects in the past time have not been increased according to the committed roadmap, which greatly affects the financial plans of many projects.
Speaking to RFA shortly thereafter, Mr. Minh Duc, owner of shipping business in Ho Chi Minh City, said that investors only think about their own profits, not the benefits of the community, of the consumers. He added:
“I live in Vietnam, so I know very well that all BOT projects got capital contributions by state officials. At first, the collection time and later on the reason was that the epidemic had lost revenue and suffered losses and many other reasons to demand an increase in revenue. According to my knowledge, interest groups have shares in BOTs. Of course, I speak according to my knowledge only, but to have a complete basis and basis, I cannot show.”
While VARSI complained about not being able to increase the fare through the BOT station, vehicle owners, as well as transport enterprises, asked for a discount. So what solution can be reconciled?
Professor Dang Hung Vo, former deputy minister of Natural Resources and Environment, told RFA:
“In my opinion, a simple solution for both parties – the service user and the investor – is for the BOT investor to extend the fee collection period. Thus, the investors will have enough time to recoup the money they have invested plus the profits and the reduction of the fee through the station will be completely reasonable during this difficult time.
The current example is for 20 years, it would increase to 25 years. Recalculate so that the fee is reduced corresponding to an extended time, even if it incurs additional losses in interest rates from bank fees.
I think no one is lost because investors always want to extend the fee collection period even without reducing the fees. After testing and testing the average number of vehicles per day, the State will determine the time limit for toll collection, for example, 20 years. Now reducing the cost, the problem is the same, also calculate the corresponding number of years. I am sure that the people and transport companies are also satisfied with the fact that COVID reduces economic activity.”
Regarding the refusal to agree to reduce BOT ticket prices, the Ministry of Transport and Transport explained that from the beginning of 2020, the COVID-19 epidemic had a negative impact on all aspects of the country’s socio-economic life. In that case, investors (BOT enterprises) are directly affected by a decrease in vehicle traffic through the toll booth, leading to a decrease in revenue, especially during the social distance implementation.
In order to support BOT businesses having difficulty in operation, in May 2020, the Ministry of Transport proposed the Government to allow the increase of road BOT fees according to the price increase schedule signed with the investor, to pay back the project, avoid arising bad debts. The Ministry also proposed the Government to continue directing ministries, branches, and localities to agree on a plan to completely handle shortcomings at traffic BOT toll stations, to direct the Ministry of Public Security and localities to have solutions to ensure order at tollbooths.
According to the explanation of the Ministry of Transport, this is a way to help the State avoid spending more than VND5 trillion to support BOT businesses affected by COVID-19.
Dr. Ngo Tri Long stated his assessment with RFA:
“The BOT owner claims a loss, but in my opinion, it’s not like that. They say that because they don’t like automatic toll collection – non-stop charging – because it will expose their official source of revenue.”
BOT toll stations are the focal point causing many protests, traffic congestion on Vietnam’s national highways over the past time because people and drivers think that some BOT stations are misplaced, collecting money too high.
Statistics of the Ministry of Transport show that, in the third quarter of 2020, BOT toll stations in Vietnam collect an average of more than VND1 trillion of toll fees. This figure is evaluated by the Ministry of Transport as quite low.
On February 7, 2019, the State media announced that two robbers had entered the toll booth on the Ho Chi Minh City – Long Thanh – Dau Giay expressway, taking more than two billion dong of toll fees. Public opinion questioned this amount because, before that, Vietnam Expressway Development Investment Corporation (VEC) gave a revenue of just over three billion dong for three toll booths in nine days.
Former Director of Central Institute of Economic Management Le Dang Doanh once said, BOT uses social capital to develop infrastructure, but in Vietnam, the whole process is confidential and not supervised by the people. Nor is there the direct oversight of the parliament or the local People’s Council.