Foreign Investment in Vietnam Energy Industry Still Modest, Experts
Foreign investment in Vietnam’s energy industry is rather modest in comparison with the country’s annual need of around $5 billion as investors still lack interest in the field, experts and investors said at the recent Vietnam Energy Summit in Ho Chi Minh City.
The national energy industry spends about $750 million on power grids annually, which meet only 30% of the total capital demand, the Saigon Times Daily newspaper cited Nguyen Duc Cuong, deputy head of the National Power Transmission Company.
The industry is seeking ways to call for more investment from various sources, including official development assistance (ODA), bond issuances and commercial bank loans but capital shortage is still a great trouble, Cuong attributed.
During the four-day event, international experts and businessmen pointed out that unclear policies, unattractive power prices and unfair business environment are major barriers to new energy developments.
The price is only five cents per kWh, which is too low for investors, said an official from a Singaporean firm.
Concerning investment in renewable energy, Erik Knive, chairman of the summit worried about the price of wind energy of 8.5 cents per kWh proposed by investors, suggesting the rate should range from 10 to 12 cents per kWh to ensure profit for investors.
Vietnam is forecast to have to import energy by 2015 and the national energy demand will triple from now by 2025, said the Ministry of Industry and Trade, predicting the nation’s reliance on imported energy at 12.2% in 2020 and 28% in 2030. (STD)
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