Investors cannot decide the price of water sold to customers as it is determined by authorities.

It is clearly an obstacle to water suppliers when the price of running water must be set by the city’s government through different competent agencies, an official of the city’s Department of Transport said.

There are few incentives for private enterprises to engage in water supply. For instance, private firms enjoy corporate income tax reductions and exemptions but they do not have priority access to preferential loans as state-owned enterprises do, said Hoang Thi Kim Chi, an official of the HCMC Institute of Development Studies.

Even the format of public-private partnership (PPP) as the main investment vehicle for private investors is a hindrance, according to the seminar.

One of the biggest concerns to private investors is that the mechanism governing PPP projects is unclear, said a representative of Saigon Water Corporation (Sawaco)

However, Chi of the Institute of Development Studies said many international companies show keen interest in the water supply sector. In particular, Philippines-based Manila Water Co. has bought a 49% stake in BOO Thu Duc water plant and a 10% stake in Nha Be Water Supply Joint Venture Company.

PV
 

(MONRE)