Total cost of HCM City’s first metro line yet to be adjusted up

07-Aug-2019 Intellasia | The Saigon Times | 6:02 AM Print This Post

Ben Thanh-Suoi Tien metro line, whose construction is more than half completed, is still waiting for its upward investment cost revision to be approved, leading to hiccups in funding.

The HCM City Management Authority for Urban Railways of HCM City (MAUR) released a report on the execution of Metro Line No.1, which links Ben Thanh Market in District 1 and Suoi Tien Theme Park in District 9, and on Metro Line No.2, which connects Ben Thanh Market and Tham Luong Depot in District 12.

MAUR identified capital adjustment procedures as a major obstacle to the big-ticket projects.

The authority cited the viewpoints of the appraisal council for the metro line projects, reporting that site clearance had been divided into subprojects, but for the assessment of the projects’ capital effectiveness and balance, the council had asked MAUR to include the subprojects in the total investment revision.

MAUR floated two plans. The first one was to reduce the costs of land acquisition, technical infrastructure and project management, alongside other costs, to make up for the shortage in value added tax (VAT).

The second plan was to maintain land acquisition costs and increase associated funds for total investment adjustments to cover the VAT shortage and reduce dependence on official development assistance loans.

For Metro Line No.2, the appraisal council agreed on some assessment criteria involving basic design and total investment.

MAUR is also working with consultants to update the requirements for project adjustments and is coordinating with the HCM City Department of Transport to write an appraisal report on the project’s adjustments.

Speaking at a recent meeting, HCM City vice Chair Vo Van Hoan called for the completion of documents on the total investment revisions of the two metro line projects.

Ben Thanh-Suoi Tien metro line, on which construction started in August 2012, stretches across 19.7 kilometers of land, mostly above ground, and connects the city centre with its eastern districts and the outlying district of Di An in neighbouring Binh Duong Province.

Funding for the metro line has been raised to over VND47.3 trillion (US$2.04 billion) from the original VND17.3 trillion in 2009.

Also, Ben Thanh-Tham Luong metro line, on which work is slated to start in 2021, has seen its investment requirements rise to VND48.8 trillion from the original VND26 trillion. percente2 percent80 percent99s-first-metro-line-yet-to-be-adjusted-up.html


Category: Business, Vietnam

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