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Vietnam Insurance Report Q1 2011


Vietnam Insurance Report Q1 2011

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Additional Information
Price $530.00
Meta Description No
Publisher Business Monitor International
Date of Report Dec 23, 2010
Quick Overview
Vietnam’s construction sector retains significant promise in 2010, but development continues to be held back by the regulatory environment in the country. Improving economic conditions in the region have helped to support construction activity, but rising inflation within the country is eroding real growth in industry value. As such, BMI is revising down its estimate from last quarter to VND127trn total construction industry value for 2010. However, growth will remain strong over the forecast period as industry value will reach US$12.7bn by 2015 on the back of increasing foreign investment. Key drivers from the past quarter include:
?? Droughts in Vietnam have become increasingly severe over 2010, with power outages occurring daily throughout the country. This has spurred the government to speed up negotiations and complete approvals for the construction of other energy sources, such as the 2,000MW Ninh Thuan nuclear plant and the 600 megawatt (MW) Binh Thuan coal-fired power plant. As such, we expect power infrastructure to benefit from the acceleration of investments.
?? The formation of a regulatory framework for wind power has taken a positive step forward in Vietnam, with the country’s Ministry of Industry and Trade finishing a draft decision on the selling prices of wind power. The draft is awaiting final approval by the Vietnamese government and is expected to be resolved by the end of September 2010.
The outlook is strengthening for the country’s infrastructure sector; however, it is too early for changes to affect the sector’s forecasts and ratings. New public-private partnership (PPP) regulations offer the potential to revolutionise project financing in the country, but at present Vietnam still languishes near the bottom of BMI’s Project Finance Ratings with a score of just 47.4. Corruption remains a major issue and while official statistics show that construction industry value accelerated in 2010 the true growth rate is doubtlessly impeded by lack of supporting business environment. Investments in transport reached VND3.2bn (US$1.7bn) in May 2010, since the beginning of the year supporting BMI’s forecast for upside in the sector to the end of the year.
Vietnam’s business environment continues to be an issue for the country, with the country’s business environment score staying the same at 52.9 for this quarter. The country’s infrastructure market scored well, but downside risks from market volatility and country risk dragged down the overall score. Corruption still remains a problem for Vietnam and is likely to continue to impede infrastructure development until government reforms can change the landscape. With increased foreign investment on the back of attractive growth rates there are signs that the country is now moving in the right direction in invoking structures to improve the business environment such as PPP regimes.
Table of Contents
Executive Summary ........................................................................................................................................ 7
SWOT Analysis ................................................................................................................................................ 9
Vietnam Infrastructure SWOT .............................................................................................................................................................................. 9
Vietnam Infrastructure Project Finance SWOT .................................................................................................................................................. 10
Vietnam Economic SWOT ................................................................................................................................................................................... 11
Vietnam Political SWOT ..................................................................................................................................................................................... 12
Market Overview ............................................................................................................................................ 13
Vietnam .................................................................................................................................................................................................................... 13
Industry Forecast Scenario ........................................................................................................................... 16
Table: Vietnam Construction And Infrastructure Industry Data, 2007-2015 ....................................................................................................... 16
Table: Vietnam Construction And Infrastructure Industry Data .......................................................................................................................... 18
Construction And Infrastructure Forecast Scenario ................................................................................................................................................ 19
Transport Infrastructure ............................................................................................................................... 21
Table: Vietnam Transport Infrastructure Industry Data ..................................................................................................................................... 21
Table: Vietnam Transport Infrastructure Industry Data ..................................................................................................................................... 23
Transport Infrastructure Forecast Scenario ............................................................................................................................................................ 25
Transport Infrastructure Overview .......................................................................................................................................................................... 26
Table: Ports Are The Weakest Link: Quality Of Infrastructure Global Ranking Out Of 134 Countries ............................................................... 28
Table: Vietnam Railway Corporation’s Main Targets ........................................................................................................................................ 28
Major Projects – New And Ongoing Projects .......................................................................................................................................................... 29
Airports ............................................................................................................................................................................................................... 29
Ports ................................................................................................................................................................................................................... 29
Roads .................................................................................................................................................................................................................. 31
Railways ............................................................................................................................................................................................................. 35
Major Projects Table – Transport ...................................................................................................................................................................... 37
Table: Major Transport Infrastructure Projects ................................................................................................................................................. 37
Energy And Utilities Infrastructure ............................................................................................................... 42
Table: Vietnam Energy And Utilities Infrastructure Industry Data ..................................................................................................................... 42
Table: Vietnam Energy And Utilities Infrastructure Industry Data ..................................................................................................................... 44
Energy And Utilities Infrastructure Forecast Scenario ............................................................................................................................................ 46
Energy And Utilities Infrastructure Overview .......................................................................................................................................................... 46
Table: The Three Levels Of Liberalising Vietnam’s Electricity Market ............................................................................................................... 49
Major Projects – New And Ongoing Projects .......................................................................................................................................................... 49
Power Plants....................................................................................................................................................................................................... 49
Pipelines ............................................................................................................................................................................................................. 54
Water .................................................................................................................................................................................................................. 54
Major Projects Table – Energy And Utilities ...................................................................................................................................................... 55
Table: Major Energy & Utilities Infrastructure Projects .................................................................................................................................... 55
Residential/Non- Residential Construction and Social Infrastructure ..................................................... 57
Table: Vietnam Residential And Non-residential Building Industry Data ............................................................................................................ 57
Table: Vietnam Residential and Non-residential Building Industry Data ............................................................................................................ 57
Residential/Non-Residential Construction Forecast Scenario ................................................................................................................................. 58
Residential/Non-Residential Construction and Social Infrastructure Overview........................................................................................................ 59
Major Projects – New And Ongoing Projects .......................................................................................................................................................... 60
Social Infrastructure ................................................................................................................................................................................................ 60
Healthcare .......................................................................................................................................................................................................... 60
Housing .............................................................................................................................................................................................................. 60
Other – Social Infrastructure .............................................................................................................................................................................. 60
Construction ............................................................................................................................................................................................................ 61
Commercial ........................................................................................................................................................................................................ 61
Residential .......................................................................................................................................................................................................... 61
Industrial ............................................................................................................................................................................................................ 61
Business Environment ................................................................................................................................. 62
Vietnam Business Environment ................................................................................................................................................................................ 62
Rewards .............................................................................................................................................................................................................. 62
Risks ................................................................................................................................................................................................................... 62
Regional Overview ................................................................................................................................................................................................... 63
Asia Pacific Infrastructure Business Environment Ratings ................................................................................................................................. 63
Table: Regional Infrastructure Business Environment Ratings........................................................................................................................... 64
Project Finance Ratings ............................................................................................................................... 68
Vietnam Project Finance Ratings ............................................................................................................................................................................ 68
Design And Construction .................................................................................................................................................................................... 68
Commissioning And Operating ........................................................................................................................................................................... 68
Overall Project Finance Rating .......................................................................................................................................................................... 68
Regional Overview ................................................................................................................................................................................................... 68
Project Finance Ratings: Outlook For Asia Pacific ............................................................................................................................................ 68
Table: Design And Construction Rating ............................................................................................................................................................. 71
Table: Commissioning And Operating Rating .................................................................................................................................................... 73
Table: Overall Project Finance Rating ............................................................................................................................................................... 75
Macroeconomic Outlook ............................................................................................................................... 76
Table: Vietnam - Economic Activity .................................................................................................................................................................... 77
Political Outlook ............................................................................................................................................ 78
Domestic Politics ................................................................................................................................................................................................ 78
Long-Term Political Outlook .............................................................................................................................................................................. 79
Company Monitor .......................................................................................................................................... 83
Cavico Corporation ............................................................................................................................................................................................ 83
Electricity of Vietnam Group (EVN) ................................................................................................................................................................... 86
Global Overview ............................................................................................................................................ 88
Table: BMI's Core Views For Global Infrastructure .......................................................................................................................................... 88
Methodology .................................................................................................................................................. 95
Industry Forecasts ................................................................................................................................................................................................... 95
Construction Industry ......................................................................................................................................................................................... 96
Data Methodology ................................................................................................................................................................................................... 96
Construction ....................................................................................................................................................................................................... 96
Capital Investment .............................................................................................................................................................................................. 97
Construction Sector Employment ........................................................................................................................................................................ 97
Infrastructure Business Environment Rating ........................................................................................................................................................... 98
Table: Infrastructure Business Environment Indicators ..................................................................................................................................... 99
Project Finance Ratings .........................................................................................................................................................................................100
Table: Design And Construction Phase .............................................................................................................................................................101
Table: Commissioning And Operating Phase – Commercial Construction ........................................................................................................102
Table: Commissioning And Operating Phase – Energy And Utilities .................................................................................................................103
Table: Commissioning And Operating Phase – Transport .................................................................................................................................104
Sources ...................................................................................................................................................................................................................105




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