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Building firms fail to win big contracts
Although the Vietnamese construction industry had seen positive growth in previous years, Vietnamese constructors struggled to win contracts for large-scale projects due to their low competency, said Vu Gia Quynh, Secretary General of the Viet Nam Association of Construction Contractors.
Quynh said there were a lack of appropriate policies that supported domestic constructors who faced many disadvantages when competing with highly-reputed and experienced foreign groups.
He said a policy that required a specific level of domestic input including the use of labour force and materials in construction projects, as in many other countries, should have been issued to support domestic enterprises.
Nguyen Thanh Su, deputy general director of Khang Thong Joint Stock Company, which is a key investor in the US$2 billion Happyland Entertainment Complex project in southern Long An province, said that sub-contracts, which were more accessible to Vietnamese enterprises, were often of low-value while there was also strong competition for them.
Many Vietnamese constructors are also at risk after submitting low bids in order to win contracts, then having to cope with the rising cost of construction materials.
Vietnamese constructors also lacked competency when it came to responding to contractual terms or other regulations, said Su.
Vietnamese constructors tended to be flexible when implementing contractual terms and they often used mediation when it came to disputes, Su said.
"In contrast, foreign bidders stuck to the contracts and punished domestic sub-contractors if they failed to meet them," he added.
Do Cong Hien, director of Vinaconex Corporation's construction department, said that seasonal workers also made it harder for domestic constructors. Many projects struggled to replace workers at harvest time when they returned to the countryside.
Although it's known that this is unprofessional, it happens due to the fact that a large proportion of workers are from rural areas.
Hien added that domestic enterprises had poorer access to high technologies than their foreign counterparts, which made them less competitive.
Vietnamese enterprises needed to take advantage of sub-contracts by learning from the technologies and experience of foreign groups, said Hien.
These were opportunities for domestic constructors to grow and become more competitive in the domestic market, he said.
vietnamnews
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