Vietnam should facilitate private investments in airports: lawmaker

Vietnam should update policies to facilitate private investments in the aviation sector and airports, as currently the private sector is only permitted to invest in small and medium-sized airports, said lawmaker Nguyen Duy Thanh.

Thanh, a National Assembly member representing Ca Mau province, told the legislature's meeting on Wednesday that the majority of small and medium-sized airports do not generate profits. "Besides, the current mechanism, particularly the public-private partnership (PPP) format for aviation projects, does not attract investors."

The project to upgrade Ca Mau Airport might be abandoned as the Airport Corporation of Vietnam (ACV), the state-run operator of key airports in the country, is not obliged to implement it. Meanwhile, private investors are not interested in the VND4.7 trillion ($200 million) price tag, leaving the project in limbo, Thanh noted.

He questioned why private companies are only allowed to invest in small and medium-sized airports which can hardly make a profit, while the Ministry of Transport has proposed allowing ACV to invest and operate six big airports that are or will be making big profits.

These six airports, namely Noi Bai (Hanoi), Danang, Cam Ranh (Khanh Hoa), Tan Son Nhat (Ho Chi Minh City), and the under-construction Long Thanh (Dong Nai province), account for 78% of passengers and 90% of cargo transport in the country according to Thanh.

The lawmaker asked the National Assembly to update the policy related to airport investment, with a focus on lesser reliance on the state budget and more room for provinces and cities to attract private investments.

In April, the transport ministry submitted a draft national plan for airports for 2021-2030, with a vision to 2050. The draft plan features 28 airports, including 14 international and 14 domestic ones.

Vietnam’s first and only privately-invested airport so far is Van Don in the northern province of Quang Ninh. The investor is Sun Group, one of Vietnam's leading real estate and tourism companies. The investment followed the build-operate-transfer format. The airport launched its first domestic flight in December 2018 and first international service in May 2019.

In the first four months of this year, 22 airports in Vietnam served 37 million passengers, up 55% year-on-year, according to the Civil Aviation Authority of Vietnam (CAAV). The figure included 9.7 million international passengers, up 976% year-on-year, and 27.2 million domestic travelers, up 18%.

However, cargo transport declined 24.3% year-on-year to 378,400 tons in the period, including 272,000 tons on international routes, down 32.1%.