Firms seek greater share of State projects

Laws - National Assembly Finance and Budget Committee member Pham Thi Loan wants the Bidding Law and Investment Law re-assessed to ensure domestic enterprises win a greater share of State projects.

The regulations governing State-funded project bidding should be examined and technical regulations changed, if necessary, to ensure the use of made-in- Viet Nam materials, she said.

The parliamentarian said that 90 per cent of State-financed EPC (Engineer – Procurement – Construction) projects now went to Chinese bidders.

She attributed the imbalance to the employment of foreign consultants to design the invitations to bid.

The standards attached to the invitations were often rigidly copied from foreign documents without any adjustment for Vietnamese practice, she said.

Viet Nam 's enterprises are limited to working as sub-contractors in electricity-related projects, except where the successful bidder is designated in advance.

But even sub-contracts are difficult to win.

Successful Chinese bidders often supplied all the materials and even the unskilled labour for projects, she said.

But any change would not preclude the necessity for Viet Nam's enterprises to improve quality; create labels and trade marks as well as become more competitive.

Economist Bui Kien Thanh argued the Government and the Trade and Industry Ministry should give priority to Viet Nam's own materials, skills and services for State-financed projects.

This included materials that must be bought in the domestic market, he said.

International bidders must also guarantee the employment of Vietnamese labour and the purchase of materials and services that domestic enterprises can provide.

The economist said small-scale bids were easier for domestic enterprises to pursue.

"But those able to compete for major projects face difficulties in writing the bidding documents."

Viet Nam Mechanical Industry Association chairman Nguyen Van Thu said imports dominated State - financed projects.

Most were equipment for industrial; hydro electricity; thermo electricity, cement, chemical and mineral projects.

And most State-owned-corporation projects attracted international bids with all of the materials and equipment imported, he said.

The chairman argued that because Viet Nam was a developing country with a growing trade deficit, the Government should create more favourable conditions for the country's own enterprises to bid for major State projects.

Otherwise, domestic bidders and producers would be overwhelmed by foreigners and imported products, especially cheap goods from China.

He agreed that a Government regulation that stipulated domestic design, materials and manufacture was necessary.

An example of how this could work was the way in which PetroVietnam, Vinaconex Corporation and the Viet Nam Industrial Construction Corporation divided their projects into small bids suitable for domestic enterprises.

Incomplete, uncompromising regulations that govern bidding for State- funded projects have also made it difficult for civil servants to take domestic enterprises into account when assessing bids.

"The complicated regulations for ODA-funded projects, or those financed from loans, create many difficulties for us in assessing bid documents and approving contracts, especially when there is less than three bidders," said Health Ministry Planning and Finance Department deputy director Nguyen Quang An.

"Following the criteria the donors set can make it hard for us to response to the auditors, because their requirement can be different."

The procurement of domestic materials and equipment was often ignored as a result.