Bringing a BOT Project to Closure in Vietnam: Problems and Prospects (Pat 2)

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III. Problems Faced When Bringing a BOT Project to Closure

As discussed above, the BOT Decrees address currency issues, dispute resolution, mortgage of assets, and they define the stages for negotiation and approval of BOT Enterprises and projects. Why isn"t this sufficient? Why have so few foreign-invested projects been licensed as BOT Enterprises since BOT-enabling legislation was introduced in 1992? Why have projects stalled both before and after having been licensed?

One explanation is that the clearly-defined negotiation process set forth in Decree 62 masks the fact that the authorized Vietnamese government negotiator has limited authority to settle substantive issues that arise during BOT contract negotiation. For example, the right to foreign currency may be provided in Decree 62, but another organization, the State Bank of Vietnam ("SBVN"), with a different agenda, must actually provide the guarantees. The right