Ho Chi Minh City Metro almost stopped construction

In late June 2018, the Ho Chi Minh City People’s Committee directed the Urban Railway Management Agency (MAUR) to sign a Memorandum of Understanding, an advance of 80% but not yet implemented.

Speaking to PV Tien Phong, a representative of the Shimizu-Meada contractor consortium construction package 1b (please not named) said that to date, the construction volume of package 1b has reached about 70% with two tunnels. install the equipment, but MAUR has not paid the contractor any money. Shinmizu Corporation (Japan) had to make an advance of 80 million USD (over 1,600 billion VND) to maintain the development package.

“People think because the project lacks capital, there is no money to pay contractors, but that’s not the case. The biggest problem is that although the Ho Chi Minh City People’s Committee is willing to make an advance, in 2018 it has advanced VND 1,000 billion, but MAUR only paid VND 220 billion to the contractor. MAUR has money in his pocket but does not pay. The general consultant’s NJPT contract ended. Ho Chi Minh City negotiated the extension 5 times, each time taking 3-4 months but to no avail”, said a representative from the Shimizu-Meada contractor consortium.

Package 1b has completed about 70% of the volume, but so far HCMC has not paid contractors

Pressure for contractors

Speaking with PV Tien Phong, Ho Chi Minh City People’s Committee Deputy Chairman Tran Vinh Tuyen said that if he wants to pay for the general consultation contract, he must extend the contract, in particular by signing a contract addendum to extend the time. before the treasury will allow him to pay the contract.

“MAUR at that time was worried that contract renewal would incur a lot of other costs, so he refused to sign, but specifically Mr Le Nguyen Minh Quang did not sign. The contract attachment only extended the time of payment through the treasury and all other content remained unchanged, but Quang also refused to sign. The treasury said that the Financial Auditor had entered work and was allowed to disburse according to the contract attachment. When the contract expires, it must be renewed. It’s just like that, so we have to wait for the new department head to finish it,” said Tuyen.

In a recent letter to City Party Secretary Nguyen Thien Nhan, Japanese Ambassador Umeda Kunio stated: “The pressure on contractors has also reached its limit. If this issue is not resolved by the end of December, I regret that the project will be forced to stop construction.”

According to Ambassador Umeda Kunio, the metro line No 1 project has been implemented with Japan’s ODA loan since 2007. The delay in approving the adjusted investment decision resulted in the project not being allocated by the Vietnamese Government the budget allocation from October 2017 . Meanwhile, the Ho Chi Minh City People’s Committee has committed to prepay the city budget until the central government allocates a budget for the project. However, this has not yet been implemented even though the Ministry of Construction has written an opinion on the possibility of paying construction costs even after the completion date of the contract package.

The Japanese Ambassador asked Ho Chi Minh City to direct relevant parties to speed up procedures so that they immediately resume paying construction costs from January 1, 2019 to contractors. As of the end of October 2018, the amount of late payments for construction contractors and consulting contractors has reached more than 100 million USD.

Untie the knot: Will pay before Tet…

In response to Ambassador Umeda Kunio, Ho Chi Minh City People’s Committee Chairman Nguyen Thanh Phong promised to expedite the process of prepayment of VND 450 billion for the contractor of the metro project No. 1.

In a meeting with the Permanent Deputy Minister of Foreign Affairs of Japan Toshiko Abe on the afternoon of January 18, President Nguyen Thanh Phong acknowledged that the project encountered several problems related to procedures such as contract renewal and the legal status of the joint venture. appraising, approving, completing projects… resulting in delayed payments to Japanese contractors. Pending capital adjustments, the city government will advance capital from the budget to pay for the volume of work carried out by contractors in 2018 and early 2019, around more than 2,000 billion VND.

“The city government will try to pay off debts that have not been repaid before the Lunar New Year (before February 1) and try to speed up payments and resolve unfinished problems to ensure that the interests of contractors are completed as projects by the end of 2020,” said Pak Phong.

Addressing the goodwill of the Chairman of the Ho Chi Minh City People’s Committee, Japan’s Deputy Foreign Minister said that Phong’s commitment to disbursing funds before Tet “is a meaningful New Year’s gift to the Government and other stakeholders.” company Japan”.

Recently, the new head of MAUR Department Bui Xuan Cuong has proposed to the Ho Chi Minh City People’s Committee to advance (phase 1, 2019) VND 2,248 billion of the budget to pay and advance 80% to contractors who have carried out work in 2018. .