Government proposes land law amendment to speed up project timelines

Vietnam's government has proposed an amendment to the land law to expedite project timelines, as reported by BMI, a unit of Fitch Solutions. The amendment, proposed on August 19, allows land acquisition and construction to begin before compensation plans are approved and resettlement arrangements are carried out for affected residents.

This proposed amendment is part of a broader effort to reform the current 2024 Land Law, which is being debated by lawmakers and expected to be approved by the National Assembly in October. The reform follows a resolution issued by the Communist Party’s Central Committee in July to overhaul land management, pricing, and compensation, replacing an earlier resolution that guided policy for the previous four years.

The proposed amendment would make these changes binding once approved in the National Assembly. The broader land law reform policy framework also focuses on addressing issues such as acquiring unresolved parcels of land when most landowners and developers in a project area have agreed to terms, clarifying criteria for seizing land, and using data-driven methods for setting land prices.

The reform aims to make a digital land database by 2030 and improve land acquisition processes, which are currently significant impediments to infrastructure development and building construction in Vietnam. Land acquisition delays have affected projects like the $7.5 billion Gia Binh International Airport and the $29 billion Red River Land Boulevard project in Hanoi.

While the amendment is still subject to National Assembly approval, BMI anticipates that its effects will materialize in the medium term, with near-term relief for the construction sector's land-related bottlenecks limited.