This is a contentious subject, and calls to fast-track spending in this area are nothing new. In fact, the government has already taken steps to underwrite up to £40bn of investment, on top of its already ambitious £250bn infrastructure plan. It is clear that headway is being made, even though progress on issues like aviation remains frustratingly slow.
Viewing this debate from a business visit to Vietnam (having just left China) provides a unique perspective.
The Asian Development Bank estimates that investment in infrastructure across the region will total at least $8 trillion (£4.9 trillion) over the coming decade. Of the more than $400bn spent on global infrastructure projects last year, 47 per cent was in Asia.
It has been reported that Hanoi, the capital of Vietnam, will need $10bn investment in commuter infrastructure over the next four years. Commentators also expect that Vietnam will double its electricity output by 2015, as it seeks to meet growing demand from its population of 88m. But, in order to do so, it will need to attract investment. From roads and ports to power generation, this is an ideal opportunity for UK firms, with the right expertise, to assist the Vietnamese government as partners on major projects.
The UK has a depth and breadth of experience in international financing like no other country. Our expertise in Public Private Partnerships (PPP) can make a vital contribution to developing Vietnam’s infrastructure. We can bring capital to infrastructure. But, crucially, we can also bring technical expertise and management across the whole life-cycle of major projects.
The announcement in 2010 of PPP pilot regulations in Vietnam was a step in the right direction. The expiry of these regulations in 2013, however, presents an opportunity for Vietnam to establish a comprehensive framework to create the conditions to attract a greater level of international capital investment.
Next year will mark over 40 years of diplomatic relations between the UK and Vietnam. In that time, relations between our countries have strengthened and broadened. Good progress continues to be made towards doubling bilateral trade to $4bn and increasing UK foreign direct investment in Vietnam to $3bn by 2013.
Vietnam is building for a brighter future, and the City stands ready to work in partnership in laying the foundations. We can help it develop as a financial hub, and to create the ideal conditions for securing investment. I look forward to exploring how City firms can best deploy their resources and skills in support of Vietnam’s vital growth and development.
David Wootton is lord mayor of the City of London.