Workshop on Non-sovereign financial products for infrastructure investment of AIIB

Also attending the Workshop were representatives of the SBV entities such as the International Cooperation Department, the Credit Department... together with representatives of other relevant ministries and agencies. On the AIIB side, there were officials from the Investment Operations Department III and the Strategy, Policy and Budget Department. In addition, the Workshop also attracted representatives from many commercial banks, financial investment funds and some investors who have been involved in infrastructure development.

SBV Deputy Governor Nguyen Kim Anh chairs the Workshop

In his opening remarks, Deputy Governor Nguyen Kim Anh emphasized: "Vietnam is renovating its growth model with the implementation of its restructuring programs, aiming at sustainable development. In the context that the current investment capital for infrastructure only meets about 50-60% of the demands for both public and private sectors, and the demand for capital in this area in the coming time is huge in order to meet the requirements for growth, to balance the resources for development investment and secure public debt, the Government of Vietnam has proposed a number of measures to attract private sector funding, including the proposal that the international development partners such as the AIIB to consider to support Vietnam through the non-state sector, the private sector, without a government guarantee to mobilize additional resources for investment in infrastructure development."

Encouraging the private sector and the commercial banks, the investment funds in the country to actively participate in infrastructure investment projects has been a successful model of capital mobilization in many countries. Accordingly, those countries set up a Financial Infrastructure Development Company to mobilize finance from various sources, then fund the projects either directly or through commercial banks, intermediaries in the country.

In this context, on the basis of the Prime Minister’s direction regarding the mobilization of capital sources for the private sector to invest in infrastructure without a government guarantee, acting as the representative body of the Government at the international financial institutions, the SBV has been actively working with the international partners to find opportunities and ways to cooperate in line with the new situation, thereby better exploiting the diversified capital of those organizations for development. Apart from the traditional funding methods, in the coming time, the international financial institutions will aim to promote private sector lendings and cooperate through intermediary financial institutions such as commercial banks, investment funds, even investors that are directly involved in the project.

This Workshop aimed to create an effective bridge between the AIIB and its potential partners in Vietnam, providing opportunities for stakeholders to explore the possibilities of cooperation, introduce Non-sovereign financial products for infrastructure investment of the AIIB, which are suitable for the needs and the practical conditions of Vietnam. As the state management agency for monetary - banking operations in Vietnam and Vietnam’s representative at the AIIB, the SBV will always accompany and actively support the stakeholders to realize this goal.

AIIB Vice President Joachim Von Amsberg talks at the Workshop

AIIB Vice President Joachim Von Amsberg said: "The AIIB is very interested in supporting infrastructure investment in Vietnam. And at the request of the Government of Vietnam, the AIIB will focus on supporting the private sector in various forms such as direct financing, granting credit lines to commercial banks, providing guarantees or mobilizing more capital from the international capital markets. "

Within the framework of the Workshop, the experts from the AIIB reported on the preliminary results of the AIIB’s 3-year operations, as well as orientations of the AIIB for the cooperation with Vietnam in the coming time. The participants' comments focused on the loan conditions and procedures as well as incentives, if any, of the AIIB for infrastructure projects in Vietnam. The participants also discussed the strategic orientations of the AIIB for Vietnam, the priority areas as well as the financial products that AIIB could cooperate with Vietnamese partners in the coming time.

Deputy Governor Nguyen Kim Anh hoped that the AIIB will strengthen cooperation relationship and accompany Vietnam in the initiatives on financial cooperation for the private sector’s involvement in infrastructure development.

VA